Use this comprehensive Texas Mortgage Calculator to estimate your total monthly house payment, including Principal, Interest, high Texas Property Taxes, Home Insurance, and HOA fees.
Texas Mortgage Calculator
Calculation Steps
texas mortgage calculator Formula
P&I Payment (M) = P [ i(1+i)ⁿ / ((1+i)ⁿ - 1) ]
Total Monthly Payment = M + (Annual Taxes / 12) + (Annual Insurance / 12) + Monthly HOA
Formula Sources: Consumer Financial Protection Bureau (CFPB), Texas Comptroller of Public Accounts
Variables Used in the Texas Mortgage Calculator
- Loan Amount (P): The principal amount borrowed. The home value minus the down payment.
- Annual Interest Rate (R): The yearly percentage rate charged by the lender.
- Loan Term (N): The length of time (in years) over which the loan is repaid, typically 15 or 30 years.
- Annual Property Tax Rate (T): The total effective property tax rate (%) applied to the home’s value (or loan amount as a proxy). Texas has no state income tax, making property taxes generally higher than the national average.
- Annual Home Insurance (I): The yearly cost of insuring the home.
- Monthly HOA Fees (H): The cost paid monthly to the Homeowner’s Association, if applicable.
Related Calculators for Texas Homebuyers
- Texas Property Tax Calculator
- Mortgage Refinance Calculator
- Amortization Schedule Generator
- Home Affordability Calculator (Texas)
What is a Texas Mortgage Calculator?
A Texas mortgage calculator is an essential financial tool that provides prospective and current Texas homeowners with an accurate estimation of their total monthly mortgage liability. It goes beyond a standard P&I (Principal and Interest) calculator by explicitly factoring in the unique components of the Texas housing market, namely the state’s notably high property taxes.
The calculator provides a complete monthly payment breakdown, often referred to as PITI (Principal, Interest, Taxes, Insurance) plus any applicable HOA (Homeowners Association) fees. Understanding the total cost, not just P&I, is crucial in Texas because property taxes can significantly inflate the total monthly outlay compared to other states.
By adjusting variables like the loan term, interest rate, and specific local tax rates (which vary widely by county and city in Texas), users can model different scenarios to find a payment structure that fits their budget, ensuring financial readiness for a major investment.
How to Calculate Your Texas Mortgage Payment (Example)
Let’s calculate the total monthly payment for a $300,000 loan, 6.0% rate, 30 years, 1.8% tax rate, $1,500 annual insurance, and $100 monthly HOA.
- Determine Monthly Rate (i): 6.0% / 12 / 100 = 0.005.
- Calculate Total Payments (n): 30 years * 12 = 360 payments.
- Calculate Monthly P&I Payment (M): Using the amortization formula, M comes out to approximately $1,798.65.
- Calculate Monthly Property Tax Escrow: Annual Taxes = $300,000 * 1.8% = $5,400. Monthly Escrow = $5,400 / 12 = $450.00.
- Calculate Monthly Insurance Escrow: Annual Insurance = $1,500. Monthly Escrow = $1,500 / 12 = $125.00.
- Calculate Total Monthly Payment: $1,798.65 (P&I) + $450.00 (Tax) + $125.00 (Insurance) + $100.00 (HOA) = $2,473.65.
Frequently Asked Questions (FAQ)
Texas does not have a state income tax, so local governments (school districts, counties, cities) rely heavily on property taxes to fund public services. This reliance often results in higher effective tax rates compared to states that collect income tax.
No, this basic calculator does not automatically include Private Mortgage Insurance (PMI). PMI is required if your down payment is less than 20%. You should manually add the estimated monthly PMI cost to the total payment if it applies to your situation.
Property taxes are legally based on the appraised market value of the home, not the loan amount. For simplicity, this calculator uses the tax rate multiplied by the Loan Amount (as a proxy for home value). For an exact figure, use your local county appraisal district’s value.
P&I stands for Principal and Interest—the core loan repayment costs. PITI stands for Principal, Interest, Taxes, and Insurance. PITI represents the full monthly payment collected by the mortgage servicer, often held in an escrow account to cover annual tax and insurance bills.