Connecticut Mortgage Calculator

Connecticut Mortgage Calculator

In many parts of Connecticut, a mortgage is the most affordable way for low- to average-income homebuyers to purchase a home. Our Connecticut mortgage calculator can help you estimate your monthly mortgage payments, and our FAQs answer common questions about buying a home in Connecticut.

Best mortgage lenders in Connecticut

Explore the world of mortgages with these top-notch lenders that have a strong foothold in Connecticut and beyond. Recognizable giants like Rocket Mortgage, Morty Inc., and AmeriSave lead the group. On the other hand, you can also consider Connecticut-based options like New England Home Mortgage LLC and CT Liberty Mortgage LLC, which may be lesser-known but offer the same level of trustworthiness.

How to calculate mortgage payment in Connecticut

Employ our speedy and effortless CT mortgage calculator to gauge your prospective monthly outlays. An elaborate walkthrough with a sequence of precise guidelines ensues underneath.

Why and How to Use Our Mortgage Calculator

Employ our Connecticut mortgage calculator for precise planning of your forthcoming expenses. Let’s take a closer look at each field in order to gain a better understanding of the mortgage in Connecticut.

The first element of the puzzle is the cost of the house – that is, the amount you plan to expend on your future property. A down payment refers to the portion of this cost that is to be paid upfront. To avoid expensive insurance, it is necessary to generate a minimum of 20% down payment (in the case of a conventional loan). The remaining sum constitutes the principal (e.g., 80% of the house cost given a 20% down payment).

The loan term represents the period during which you will fully repay your mortgage through scheduled payments. Fixed-rate conforming loans usually have a maximum duration of 30 years, while adjustable-rate options generally have shorter terms.

The interest rate is a fixed or variable fraction of the principal amount that you must pay throughout the loan duration. It is important to note that you are subjected to an annual percentage rate (commonly abbreviated as APR), which is not the same as the interest rate. While the interest rate makes up the majority of the APR value, the latter also incorporates various fees (e.g., origination fee, closing costs, insurance payments, etc.).

For a more precise assessment, the interest rate utilized for these calculations is based on the present mortgage rates in Connecticut, assuming a $400,000 house price and a 10% down payment.

Connecticut Housing Market 2023

Over the past year, there has been a significant rise in the market worth of residential properties in Connecticut. This upturn follows a long-standing pattern magnified by the impact of the COVID-19 outbreak. However, the rate of expansion has decreased in comparison to the previous year, whereas both buying and refinancing rates have been steadily climbing and are anticipated to escalate further in the coming days.

Median property taxes in Connecticut counties

The property tax is another important thing to consider when selecting your future house. Many lenders insist on setting up a mortgage escrow account to ensure the borrower’s keeping up with the tax and insurance costs.

Source: American Communities Survey 2016, U.S. Census

How do I calculate my mortgage payment?

To simplify the process, you can take advantage of our Connecticut mortgage calculator. It operates using a basic formula that can also be used manually to determine the payment amount:

M = P*i(1 + i)^n / (1 + i)^n – 1

M – estimated monthly mortgage payment;

P – principal;

I – monthly interest rate (to find this, divide your annual mortgage rate by 12);

N – the loan term presented in months (in other words, the total number of monthly payments)

Imagine you are applying for a 15-year mortgage loan with a fixed 6.99% APR (equivalent to .0699 as a unit fraction). The cost of the house is $500k, and you plan to make a down payment of 10% ($50,000). This means that the principal amount (P) will be equal to 90% of the initial home cost ($500,000 – $50,000 = $450,000).

I = .0699% / 12 = .005825%.

Lastly, let's convert the loan duration from years to months: N = 15 * 12 = 180.

M ($) = 450,000 * .005825(1 + .005825)^180 / (1 + .005825)^180 – 1 ≈ 4042.

Therefore, you can expect to pay approximately $4042 per month.

Please keep in mind that the calculated M value is an approximation and does not account for any additional fees.

Tips for first-time home buyers in Connecticut

Initially, there exist several federal agencies (USDA, FHA, and VA) that guarantee loans for selected borrowers. Many individuals purchasing their first homes can explore alternatives that align best with their financial plan.

Apart from these government-backed initiatives, it is advisable to take into account certain offerings from UHC (Connecticut Housing Corporation) that are accessible to residents of Connecticut. Specifically, first-time homebuyers can opt for the FirstHome program - a scheme that assists with down payments and closing costs, provided they meet the eligibility criteria for an FHA loan and possess a FICO score of at least 660. This opportunity covers up to 6% of the loan amount to be utilized for the down payment and/or the closing costs. It is crucial to note that this option is exclusively presented as a 30-year-fixed-rate second loan. If you do not meet the requirements for the FirstHome program, there is no need to lose hope. An alternative program, known as the Connecticut Housing Score Loan, offers coverage of up to 4%. The minimum acceptable credit score is 620.

Valuable suggestions for first-timers:

1. Obtain pre-endorsement in advance. This step will boost your credit reliability in the eyes of home sellers. It is highly recommended to secure the pre-endorsement letters from not only one but at least two or three different lenders.
2. Compare varying mortgage rates. Choose a minimum of three lenders. The more, the superior.
3. Conduct initial computations based on the sum you have been pre-endorsed for. Plan your prospective expenditures.
4. Set aside as much as possible – and as early as possible – for a down payment. The down payment will decrease the principal amount, which, in turn, can curtail your potential expenses. Therefore, it is important to commence saving ahead of time.
5. If you are eligible for a VA loan, prioritize this option above all others.
6. Consider government-backed schemes, as well as local support programs. There might be appealing offers – don't miss the opportunity.
7. Repay previous debts.