At the moment, I have a few coaching clients looking to buy a house. They're saving for a down payment and are trying to figure out what their new budget will be after swapping rent for a mortgage payment.
Easy peasy, I thought! We'll go find a mortgage calculator and plug all those numbers in to get an accurate estimate.
Wouldn't you know, there are about 100 mortgage calculators out there and they all do different things. Below is my ranking of the top mortgage calculators out there and why I like them. You might have different priorities, so I've let you know what each does well and what they don't do so well.
I have not been compensated for any opinions in this post. Also, all opinions are my own.
Zillow.com has two different mortgage calculators: a standalone calculator and a calculator within each listing. Zillow's within-listing calculator is by FAR my favorite mortgage calculator as it seems to be the most accurate automatic calculator out there. You input your down payment and Zillow calculates the rest. It knows the town's property tax rate, estimates PMI, and gives you a pretty good home insurance estimate. It even knows the exact HOA fees (if any)! This calculator takes little to no effort on your part to get a good estimate.
Pros:
Automatically calculates PMI, interest rates, property taxes, home insurance, and HOA fees.
Easy to use and modify
Easy to find on each home listing
Definitions are right on the page, so you know what you're looking at
Cons:
PMI uses 0.5% calculation, which could be low
No mention of closing costs (average 2-5% of total home value)
It takes a few clicks to find this calculator within each listing. Worth it.
Because I don't need to go elsewhere to find property tax rates, interest rates, PMI, home insurance rates, and HOA fees, Zillow's within-listing mortgage calculator is my favorite mortgage calculator. It takes all the guess work out and gives a pretty accurate estimate as to what I'd pay if I were to buy this house.
Just remember that estimated 2-5% in closing costs that you will have to pay at closing. Those aren't in here and there's no warning on Zillow about them (because they're variable by realtor, contract, and attorney).
There are other within-listing calculators on other real estate browsing websites, like Redfin and Realtor.com. Personally, I trust Zillow's data best as it consistently tracks mortgage rates and property tax rates. Other websites purchase this data from Zillow Group Marketplace, Inc. (ZGMI).
SmartAsset's mortgage calculator gives you what you need to estimate your new home costs. It's not as easy or automatic as Zillow's within-listing mortgage calculator, but you can easily and quickly use it to estimate your full mortgage costs with a little hunting and pecking for HOA costs and more accurate interest rates.
Pros:
"Other Financial Considerations" section helps first time home buyers understand your true cost of home buying
Easy to modify
Automatically estimates property tax, homeowner's insurance, and interest rate
Hover-over explanations of terms, so you know what you're looking at
Includes mentions of closing costs, which provides a fuller picture of your home buying expenses
Cons:
Not as easy to use as the other tools
Doesn't always seem to update properly
Does not allow for extra payments in the schedule
Output isn't as visually appealing as the others
Everyone's situation is different. With SmartAsset's mortgage calculator, you'll need to do a little more homework than Zillow's within-listing mortgage calculator. You'll need to find your HOA fees, if any, and will need to make sure to click and scroll to find and check all the features. I found that the property taxes and PMI don't always update when I update the numbers, so refresh the page a few times to help the system catch on to your changes. It'll take you maybe 2 or 3 more minutes to really get a good estimate using this mortgage calculator.
The best feature on SmartAsset's mortgage calculator is the inclusion of closing costs and the "Other Financial Considerations" information. That should really help you figure out what money to set aside when buying your first home.
Bankrate's mortgage calculator slides right in as a close competitor to SmartAsset's. It's not as fun as Zillow, because you don't see the house you might be looking to buy. Also, Bankrate's mortgage calculator doesn't estimate PMI. It does automatically estimate property taxes and mortgage rates based on your zip code and credit score.
My favorite part of this calculator is the "Amortization schedule" tab, which allows you to add extra payments on the frequency of your choice. Do you want to throw extra on your mortgage from the get go? Maybe starting in a few years? Figure out how much interest that can save you with this calculator. It's pretty nifty.
Pros:
Easy to use and modify
Automatically estimates property tax, homeowner's insurance, and interest rate
Includes extra payments option on amortization schedule
Hover-over explanations of terms, so you know what you're looking at
Cons:
No mention of closing costs (average 2-5% of total home value)
Does not include PMI (which can be expensive)
Bankrate's mortgage calculator is decent. It works. You can modify it. That said, it leaves PMI and closing costs out of the equation, which sends the wrong message to home buyers. You need to factor in all costs before buying a house. Make sure you're looking at the full picture and add those costs in if you decide to use this calculator.
NerdWallet's mortgage calculator isn't as intuitive, pretty, or automatic as some of the others. While it calculates property taxes, PMI, and insurance rates for you, I didn't realize it was customizable until the next day. Maybe I'm slow.
I get the distinct impression they're trying to get me to buy something, too, which is off-putting.
Pros:
Easy to set up
Loan type comparison feature
Automatically estimates property tax, PMI, homeowner's insurance, and interest rate
Hover-over explanations of terms, so you know what you're looking at, but not what they're using to estimate their calculations
Cons:
No mention of closing costs (average 2-5% of total home value)
Not as intuitive to use as the other mortgage calculators
NerdWallet's calculator works and you can modify each piece, but it's not as intuitive as the rest. There are also affiliate links scattered around, which makes this tool less appealing.
Dave Ramsey's mortgage calculator is pretty manual. It doesn't automatically include PMI, property taxes, or insurance rates. You have to know to include the right rates for all three. If this is your first time buying a home, you don't know where to start. Average PMI is 1%, so why use 0.5% as the basis? That seems off to me.
Property taxes and insurance estimates can be automatically calculated if you have the data. Dave Ramsey's team doesn't seem to have the data. That means this calculator expects you to find and input the right data into your calculator. I'd rather use a tool that's figures it out for me.
Pros:
Includes PMI as an option
Easy to use and understand
Gives you a recommendation on what to do
Cons:
PMI, property taxes, and insurance are not automatically calculated based on location. You have to figure that out yourself.
No mention of closing costs (average 2-5% of total home value)
Instead of having hover-over alt text, definitions of terms are way down on the page.
While Dave Ramsey's mortgage calculator is okay, it's missing some vital mortgage calculator components (auto-estimates).
In all, we have five solid mortgage calculators. I don't count Google's, which is a basic input/output type of calculator. Based on what you need, you can find a mortgage calculator that works for you.
My advice
If you're buying a house, use the mortgage calculator within the listing page on Zillow, Redfin, or Realtor.com. Remember to factor in closing costs (2-5% of listing price) and know that HOA fees aren't the only fees associated with condos. Avoid PMI whenever possible. Even if it takes longer to save, please do your best to get to 20% down, so you don't have to pay PMI. It's money right out the window.
If you're looking for help saving for a down payment on a home, book a complimentary consultation with us on our home page. We work with individuals and couples on their saving behaviors and mindset, finding and squashing unnecessary spending, and building a financial plan that will serve you well for life.