Montana Mortgage Calculator

Best mortgage lenders in Montana

Leading mortgage lenders in Montana have a nationwide presence. These include such recognizable names as Morty Inc, NBKC, AmeriSave.

How to calculate mortgage payment in Montana

Use our quick and user-friendly mortgage calculator MT to evaluate your future monthly expenses. A detailed step-by-step instruction follows below.

Why and How to Use Our Mortgage Calculator

Use our house payment calculator Montana for thorough planning of your future spendings. Let’s take a closer look at each field in order to gain a better understanding of the mortgage in Montana parameters.

The initial aspect to consider is the home price, representing the amount you plan to spend on your future property. A down payment is the upfront portion of this price. To avoid expensive insurance, it's crucial to come up with at least a 20% down payment, particularly for a conventional loan. The remaining amount constitutes the principal, which, for example, makes up 80% of the home price with a 20% down payment.

The loan term refers to the period for full mortgage repayment through scheduled payments. Fixed-rate conforming loans are typically allowed to extend for up to 30 years, while adjustable-rate options typically feature shorter terms.

An interest rate is a fixed or variable percentage of the principal amount that you must pay over the loan's duration. It's important to note that you are actually charged an annual percentage rate (commonly abbreviated as APR), which is not exactly the same as the interest rate. While the interest rate comprises the majority of the APR value, the latter also includes various fees such as origination fees, closing costs, insurance payments, and more.

For a more precise assessment, the interest rate used in these calculations is based on the current mortgage rates in Montana, considering a $400,000 home price and a 10% down payment.

Median property taxes in Montana counties

Property taxes represent another crucial factor to take into account when choosing your future home. A common practice among lenders is to establish a mortgage escrow account to ensure that the borrower remains current with their tax and insurance obligations.

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

Montana Housing Market 2024

Over the past year, there has been a sharp rise in the market value of homes in Montana, which is an extension of a long-standing trend that was intensified by the COVID-19 pandemic. However, it's important to note that the rate of growth has slowed compared to the previous year, while both purchase and refinance rates have been steadily rising for a considerable period and are anticipated to continue increasing in the near future.

How do I calculate my mortgage payment?

The most convenient way to do this is to make use of our calculator. It's powered by a simple formula, which you can also use to calculate the amount to be paid by hand:

M = P*i(1 + i)^n / (1 + i)^n – 1

M – estimated monthly mortgage payment;

P – principal;

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

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

Imagine you are in the process of applying for a 15-year mortgage loan with a fixed 6.99% APR, which can be expressed as 0.0699 as a unit fraction. The house is priced at $500,000, and you intend to make a 10% down payment, equivalent to $50,000. Consequently, the principal amount (P) will be $450,000, representing 90% of the initial home cost, calculated as $500,000 minus $50,000.

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

Finally, let’s convert the loan length from years to months: N = 15 * 12 = 180.

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

So, you are going to pay about $4042 a month.

It is important to note that the calculated M value is approximate, as no extra fees are taken into account.

Tips for first-time home buyers in Montana

Firstly, there are several federal agencies, including USDA, FHA, and VA, that offer loan guarantees to specific borrowers, providing various options that can suit the financial needs of many first-time homebuyers.

Apart from these government-backed programs, it's advisable to consider opportunities presented by the UHC (Montana Housing Corporation) that are accessible to residents of Montana. In particular, first-time homebuyers may apply for the FirstHome program if they qualify for an FHA loan and have a FICO score of at least 660. This program provides assistance with down payments and closing costs, covering up to 6% of the loan amount. It's important to note that this assistance is provided in the form of a 30-year fixed-rate second loan exclusively. If you do not meet the requirements for the FirstHome program, there is no need to lose hope. The Montana Housing Score Loan is an alternative program that covers up to 4%, with a minimum acceptable credit score of 620.

Here are some valuable tips for first-time homebuyers:

1. Obtain pre-approval in advance. This will enhance your credibility in the eyes of home sellers. It is highly recommended to secure pre-approval letters from not just one, but at least two or three different lenders.
2. Compare mortgage rates from at least three lenders. The more options you explore, the better.
3. Conduct preliminary financial calculations based on the amount you have been pre-approved for to effectively plan for your future expenses.
4. Start saving for a down payment as early as possible, setting aside as much as you can. A larger down payment reduces the principal amount, which, in turn, can decrease your overall potential expenses. Therefore, it's crucial to begin saving well in advance.
5. If you are eligible for a VA loan, consider this option as your first choice.
6. Explore government-backed plans and local assistance programs, as they may offer enticing opportunities that you won't want to miss.
7. If feasible, work on paying off any existing debts before starting your home-buying journey.