Reviewer: David Chen, CFA (Chartered Financial Analyst).
This Connecticut Mortgage Calculator provides a detailed estimate of your monthly mortgage payment (Principal, Interest, Taxes, and Insurance – PITI) based on current Connecticut property tax rates and insurance averages.
Connecticut Mortgage Payment Calculator
Mortgage Calculator Formula
The core of a mortgage payment calculation involves finding the Principal and Interest (P&I) monthly payment, known as the amortization formula.
M = P [ i(1 + i)^n / ((1 + i)^n – 1) ]
Where:
- M = Monthly Principal & Interest Payment
- P = Principal Loan Amount
- i = Monthly Interest Rate (Annual Rate / 12)
- n = Total Number of Payments (Loan Term in Years * 12)
Total Monthly Payment (PITI) = M + (Annual Tax / 12) + (Annual Insurance / 12)
Formula Sources: Bankrate | Investopedia
Variables Explained
- Loan Principal Amount: The total amount of money borrowed to purchase the home, minus any down payment.
- Annual Interest Rate (%): The annual rate charged on the loan. The monthly rate used in the formula is this value divided by 12.
- Loan Term (Years): The duration over which the loan is scheduled to be repaid (e.g., 15 or 30 years).
- Annual Property Tax ($): The estimated yearly real estate tax in Connecticut, which is divided by 12 and added to your monthly payment (Escrow portion).
- Annual Home Insurance ($): The annual cost of mandatory homeowners insurance, also divided by 12 for the monthly escrow portion.
Related Calculators
Explore other tools that can help you with your home financing journey:
- FHA Loan Eligibility Calculator
- Refinance Break-Even Point Calculator
- Debt-to-Income (DTI) Ratio Calculator
- Home Closing Cost Estimator
What is a Connecticut Mortgage Calculator?
This tool is designed to provide prospective Connecticut homebuyers with a realistic estimate of their monthly housing costs. Unlike general mortgage calculators, this version emphasizes the “T&I” (Taxes and Insurance) components, which are crucial in a high-tax state like CT. Property taxes vary significantly across towns, so accurately inputting your specific town’s mill rate is key to getting a precise PITI estimate.
The calculator breaks down the total payment into four main components: Principal, Interest, Property Taxes, and Home Insurance (PITI). Knowing this figure is essential for budgeting and determining affordability before applying for a loan.
How to Calculate a CT Mortgage Payment (Example)
Using a hypothetical $300,000 loan, 30-year term, and 6.5% interest rate:
- Determine Monthly Rate (i) and Payments (n): Monthly rate (i) is 0.065 / 12 = 0.005417. Total payments (n) is 30 * 12 = 360.
- Calculate Principal & Interest (P&I) Payment (M): Plug $300,000, $i$, and $n$ into the amortization formula. M = $1,896.20.
- Calculate Monthly Tax: If annual property tax is $6,500, the monthly tax is $6,500 / 12 = $541.67.
- Calculate Monthly Insurance: If annual home insurance is $1,500, the monthly insurance is $1,500 / 12 = $125.00.
- Determine Total PITI: Add all monthly components: $1,896.20 (P&I) + $541.67 (Tax) + $125.00 (Insurance) = $2,562.87.
Frequently Asked Questions (FAQ)
PITI stands for Principal, Interest, Taxes, and Insurance. It represents the total monthly payment a homeowner makes, with the latter two (Taxes and Insurance) often held in an escrow account by the lender.
Connecticut has one of the highest effective property tax rates in the U.S. Because property taxes form a significant portion of the total monthly payment, including them accurately is critical for determining true affordability, which is the core function of this CT-specific calculator.
This is primarily a payment calculation tool (solving for M). While complex financial calculators can solve for principal or term, for practical mortgage planning, knowing the payment (M) is the essential output based on standard inputs (Principal, Rate, Term).
This simple calculator does not automatically include PMI. If your down payment is less than 20%, you should manually estimate your annual PMI cost and include it in the ‘Annual Home Insurance’ field for a more accurate result.