Fixed-Rate Loan Cost Comparison
Compare two fixed-rate loans with the same principal, each full term, cash-paid upfront fees and quoted borrower mortgage insurance for its entered months.
What This Calculator Does
Compare covered cash costs for two fixed-rate, fully amortizing loan offers with the same principal. Each runs through its own full term, with one-time cash-paid fees and a supplied level monthly mortgage-insurance premium for the first entered payments. See principal/interest separately from the initial payment including insurance. Costs within $1 are close under this model, not identical offers.
Who Is This For
For borrowers and real-estate professionals reviewing comparable lender quotes. Use supplied note rates, terms, cash fees and insurance facts; the result does not establish approval, affordability or the best economic choice for an earlier sale/refinance.
How It Works
Enter the same loan amount for both offers. For A and B, enter the fixed yearly note rate, the term in years, upfront costs paid in cash, the monthly mortgage insurance the borrower pays and how many of the first payments it applies to. Enter 0 for both the amount and the months only when you've confirmed there is no extra monthly premium. Tick the confirmation, then compare principal and interest payments, the first payment with insurance, each loan's full-term total and the A-minus-B differences (+ or −).
Frequently Asked Questions
What costs are covered, and why can loan terms differ?
Each offer's scheduled principal and interest over its own full amortization term, plus entered cash-paid upfront fees and level borrower-paid monthly mortgage insurance for its first K payments. The common principal is included once. Different terms are deliberate; this is not a same-date early payoff or discounted-economic comparison. Property tax, home insurance, association costs, income-tax benefits and other excluded ownership costs are not computed.
Can quoted mortgage insurance reverse the lower-cost result?
Yes. For a hypothetical $400,000 loan, A at 6.5% for 30 years with no fees has about $910,177.95 in principal/interest. B at 6.6% for 30 years with no additional borrower insurance has about $919,668.70. Add A's quoted $150 premium for its first 96 payments: $14,400 insurance makes A about $924,577.95, and B lower by about $4,909.26 before display reconciliation. The initial insured payments are about $2,678.27 versus $2,554.64. These are supplied examples, not market premiums or a legal cancellation period.
Does a lower monthly payment mean a lower full-term cost?
No. Illustrative $400,000 principal, A at 6.5% over 30 years with $2,000 cash fees and B at 6% over 15 years with $4,000 cash fees, both without monthly insurance: A's principal/interest is about $2,528.27 monthly versus B's $3,375.43. Covered lifetime costs are about $912,177.95 versus $611,576.92. The lower monthly payment has the higher full-term total; affordability and the value of payment timing need separate consideration.
How should I enter upfront fees and lender-paid insurance?
Use loan-related costs actually paid in cash, counted once and not financed. A one-time mortgage insurance premium paid in cash goes in upfront costs once, not also as a made-up monthly premium. Include quoted third-party costs that depend on the loan; leave out refundable escrow balances and anything counted twice. If the lender already pays the insurance through the quoted rate, extra borrower-paid monthly insurance is 0 only when confirmed. Different loan amounts, financed fees or incompatible credits need a different comparable analysis.
What does the insurance payment count mean?
A fixed monthly premium paid by the borrower applies to the first K scheduled payments. With a premium, K is from 1 up to the loan's term in years × 12; with no extra premium, enter 0 for both the amount and the count. This isn't an appraisal or loan-to-value rule or a cancellation calculation, and it doesn't guarantee when the insurance ends. Falling, delayed or variable premiums aren't covered by this simple model. The first payment with insurance is not a permanent or total housing payment.
What does the within-$1 result mean?
The exact full-term cost difference must be more than $1 for A or B to be shown as lower. A difference of $0.99 or exactly $1 is labeled close; $1.01 is not. The difference (+ or −) still appears, with A minus B positive when A costs more. "Close" doesn't mean the loans are identical, exactly equal, approved or within a universal finance threshold. The rule is applied before rounding for display.
Can I enter a 0% rate or zero insurance?
Yes, as supplied mathematical or hypothetical quote facts, not a market-rate claim. At 0%, total principal/interest equals principal and interest is exactly 0; cash fees and quoted insurance still cost money. A $120,000 loan at 0% has $1,000 principal/interest over 10 years versus about $333.33 over 30 years, but the same $120,000 principal total before fees/insurance. Blank amounts are not confirmed zero, and zero principal is not a loan comparison.
How do rounding and excluded features affect the decision?
Amounts keep cents; rates allow four decimal places. Payments, interest and each loan's full-term cost are kept exact for the ranking. The totals shown and their separately rounded difference can differ by a cent; don't rebuild the result from rounded monthly payments. This is not a servicer statement or an APR, break-even, early-payoff, NPV, equity, variable-rate, income-tax or loan-approval calculation. Use a separate analysis for a sale or refinance before the full term or for a different payment stream.