How do property taxes affect your monthly payments? This is a topic that many people are unclear about, so I’d like to shed some light on it today.
If we have a $200,000 home where the interest rate is 4%, and the mortgage is set over a period of 30 years, your regular payment (without taxes and insurance) would be about $955.
Now suppose that your property tax is 2.5%. You would multiply that $200,000 by 2.5%, leaving you with $5,000. Since there are 12 months in the year, divide that $5,000 by 12, which would be $416.66.
Now that you have that figure, add it to the $955 monthly payment. That means that you’ll pay $1,371.66 per month.
However, don’t forget your insurance. Supposing your monthly insurance payment is $50, you’d add it to the last figure, totaling a $1,421.66 monthly payment.
When it comes to figuring out how much you’ll pay per month for your home, factoring in property tax and insurance make a big difference.
If you have any questions about calculating property taxes or how to figure out your total monthly payments, don’t hesitate to reach out to me. I’d be glad to help.