May 5, 2004 Grid of how much a $500,000 home will cost per month
The following table assumes the following:
1. 20% down payment of $100,000, hence a $400,000 mortgage.
2. Annual real estate taxes of $10,000.
3. Annual insurance of $1,200.
4. 30 Year , no point , fixed mortgage ( I often prefer 15 years, but for this illustration, we will use 30 year).
| Date of Mortgage | Rate | Real Estate Taxes | Insurance | Mortgage Payment | Total Payment |
| April 1, 2004 | 5.50% | $833.34 | $100.00 | $2271.16 | $3204.50 |
| May 1, 2004 | 5.75% | $833.34 | $100.00 | $2334.29 | $3267.63 |
| May 11, 2004 | 6.00% | $833.34 | $100.00 | $2398.21 | $3331.55 |
| May 17, 2004 | 6.25% | $833.34 | $100.00 | $2462.87 | $3396.21 |
| July 11, 2006 | 6.625% | $833.34 | $100.00 | $2561.25 | $3494.59 |
July 11, 2006 Notice how payments from July 11, 2006 compared to April 1, 2004 went up $290.09. This is almost a 9.10% increase in mortgage payments. To put it another way, to get the same payment of $2271.16 on May 17, 2004, the purchaser would now be borrowing $354,696. This is 12% less than the original borrowing of $400K. This analysis does not take into account rising real estate taxes.
May 17, 2004 Notice how payments from May 17, 2004 compared to April 1, 2004 went up $191.71. This is almost a 8.50% increase in mortgage payments. To put it another way, to get the same payment of $2271.16 on May 17, 2004, the purchaser would now be borrowing $368,864.
May 11, 2004 Notice how payments from May 11, 2004 compared to April 1, 2004 went up $127.05. This is almost a 6% increase in mortgage payments. To put it another way, to get the same payment of $2271.16 on April 1, 2004, the homeowner would now be borrowing $378,810, which would be $21,190. This is something to watch. Keep in mind that rates have only gone up 1/2 of 1 %, or to look at it another way, rates have increased 9% off the rates of April 1, 2004.
This is an easy to use link for mortgage calculations
Our CPA home page has many calculators as well