Delaware Mortgage Calculator
Mortgage is next to the only affordable option for low to average income home buyers in many parts of Delaware and the rest of the United States. On this page we offer a convenient Delaware home loan calculator to gauge your potential expenses, and up-to-date answers to several frequently asked questions concerning buying a house in Delaware.
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Delaware Mortgage Calculator
Mortgages are a popular option for homebuyers in Delaware, as they offer a way to finance the purchase of a home without having to pay the full amount upfront. On this page, we provide our Delaware mortgage calculator that can help you estimate your monthly mortgage payments, as well as answers to frequently asked questions about buying a home in Delaware.
Best mortgage lenders in Delaware
The most popular mortgage lenders in Delaware are nationwide brands, such as Pentagon Federal Credit Union, Morty Inc., and AmeriSave. However, there are also several lesser-known but trustworthy options available, including Delaware-based Primary Residential Mortgage Inc. and 1st Capitol Mortgage Inc.
These lenders offer a variety of mortgage products, including fixed-rate mortgages, adjustable-rate mortgages, and jumbo loans. They also have a variety of loan terms available, so borrowers can find a loan that fits their needs.
How to calculate mortgage payment in Delaware
Our Delaware mortgage calculator is a powerful tool that can help you plan for your future. With just a few simple inputs, you can get an accurate estimate of your monthly mortgage payments. This information can be invaluable when you are making decisions about buying a home or refinancing your existing mortgage.
Why and How to Use Our Mortgage Calculator
Use our Delaware mortgage calculator to plan your future homeownership expenses. Let's take a closer look at each field to understand the mortgage parameters in Delaware.
- Home price is the amount you plan to spend on your future home. The down payment is the portion of the home price that you pay upfront. To avoid paying private mortgage insurance (PMI), you must make a down payment of at least 20% of the home price. The principal is the remaining amount of the home price that you borrow from the lender.
- Loan term is the length of time you have to repay the loan. Fixed-rate mortgages have an interest rate that remains the same for the life of the loan. Adjustable-rate mortgages have an interest rate that can change over time.
- Interest rate is the cost of borrowing money. The annual percentage rate (APR) is the total cost of borrowing money, including interest and fees.
For more accurate results, the interest rate used for these calculations is based on the current mortgage rates in Delaware, with a home price of $400,000 and a 10% down payment.
Delaware Housing Market 2023
The Delaware housing market has been on a tear in recent years, with home values soaring by double digits in some cases. This trend has been driven by a number of factors, including low interest rates, strong job growth, and a limited supply of homes on the market. However, there are some signs that the market may be cooling off. Purchase and refinance rates have been rising in recent months, and some experts believe that home prices may start to plateau in the near future.
Median property taxes in Delaware 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.
| County | Avg. property tax rate | Avg. home value |
|---|---|---|
| Kent County | $833 | $223,100 |
| New Castle County | $1,385 | $255,500 |
| Sussex County | $662 | $276,800 |
Source: American Communities Survey 2016, U.S. Census
How do I calculate my mortgage payment?
The most convenient way to estimate your monthly mortgage payment is to use our Delaware mortgage calculator. It is powered by a simple formula that you can also use to calculate the amount to be paid by hand.
The formula is:
M = P*i(1 + i)^n / (1 + i)^n – 1
M – estimated monthly mortgage payment;
P – principal;
I – monthly interest rate (to determine this, divide your annual mortgage rate by 12);
N – the loan term expressed in months (in other words, s the number of payments over the life of the loan)
Suppose you decide to pursue a 15-year mortgage plan with a consistent APR of 6.99% (equivalent to .0699 expressed as a unit fraction). The property in question carries a price of $500,000, and you intend to make a down payment of 10%, which amounts to $50,000. Consequently, the principal amount (P) will equal 90% of the original home value ($500,000 – $50,000 = $450,000).
I = .0699% / 12 = .005825%.
Lastly, let us convert the loan term from years to months: N = 15 * 12 = 180.
M ($) = 450,000 * .005825(1 + .005825)^180 / (1 + .005825)^180 – 1 ≈ 4042.
Therefore, you can expect to make an approximate monthly payment of about $4042.
It is important to acknowledge that the computed value of M is an approximation and does not encompass any supplementary charges.
Tips for first-time home buyers in Delaware
Initially, there exist numerous federal establishments (USDA, FHA, and VA) that provide assurance for loans to chosen borrowers. A plethora of prospective home purchasers can discover alternatives that best align with their financial plans.
In addition to these government-backed initiatives, it is worthwhile to contemplate certain propositions from UHC (Delaware Housing Corporation) that are accessible to residents of Delaware. Specifically, individuals purchasing a home for the first time can make an application for FirstHome—a program that furnishes assistance for down payments and closing costs—if they meet the requirements for an FHA loan and have a FICO score of no less than 660. This choice caters for up to 6% of the loan amount, which can be allocated towards the down payment and/or the closing costs. It is important to emphasize that this opportunity exclusively manifests as a second loan with a fixed interest rate spanning 30 years.
Valuable pointers for individuals new to the process:
- Secure pre-approval in advance. This will bolster your creditworthiness in the perspective of home sellers. It is highly recommended to obtain pre-approval letters from not only one, but at least two or three different lenders.
- Compare varying mortgage rates. Opt for a minimum of three lenders. The more, the more advantageous.
- Conduct preliminary calculations based on the amount you have been pre-approved for. Strategize your future expenses.
- Set aside as much as possible – and as early as possible – for a down payment. The down payment will diminish the principal amount, thereby potentially reducing your expenses. Therefore, it is crucial to initiate savings well in advance.
- If you qualify for a VA loan, prioritize this choice foremost.
- Take into account government-backed programs, as well as local assistance initiatives. Appealing offers might be within reach – ensure you don't let them slip away.
- Pay any outstanding debts, if possible.