How to Calculate the Monthly Payment

Start with the approximate sales prices of recently sold houses in the neighborhood. Next, figure out what amount of money you have for the down payment. This will most likely need to be a 5% down payment. If you do not have 5%, often you can put only 3% down. Next, realize your closing costs will be 2 % to 3% of the purchase price (depending on any real estate transfer tax in your state). Then calculate the mortgage you will need by taking the home price and deducting the 5% down payment and adding the closing costs. Finally, use a mortgage calculator online.