If you’re preparing to purchase your first home, you’re probably scratching your head more than you anticipated. Between the complex terminology and variety of home loan options, the home-buying process can become confusing rather quickly.
One area that first-time homebuyers struggle the most to understand is their monthly mortgage payment. Unlike a car loan, it’s not as clear-cut. And most real estate websites and financial calculators only focus on the principal and interest portion of your payment – which can be very misleading.
Before you get your hopes up and realize that the house you’ve been eyeing is out of your price range, take a moment to familiarize yourself with the components of a mortgage payment.