# Oregon Mortgage Calculator | the ascent

## How do I calculate my mortgage payment?

First of all, you don’t have need find out how to manually calculate your mortgage payment (unless you’re reading this for some math class). We have in this article a great Oregon Mortgage Calculator that can do the hard work for you.

That said, you can calculate your mortgage payment by hand, so we’ll see how that works. Before we get to the formula, here are the three variables you need to know.

### Director (P)

In loans, principal refers to the original amount you borrowed, not the current loan balance or the sale price of the home. If you have a \$200,000 mortgage, this is what you should use. Also, if you’ve built any of your origination fees or closing costs into your loan (most common with FHA loans), don’t forget to include those as well.

### Interest rate (r)

For the purposes of calculating your mortgage payment, you will need to use the interest rate of your loan on a monthly basis. This is because you calculate how much you will have to pay each month for your mortgage. To find it, start with the nominal interest rate of your loan (not the APR), expressed as a decimal — so 5% would be 0.05. Then divide it by 12 to find the number you will use in the formula.

### Number of months (n)

To determine the number of months in your mortgage term, simply take the number of years and multiply by 12. For 15 and 30 year mortgages, you would use 180 and 360, respectively.

The formula for calculating the mortgage loan

Without further ado, here is the formula you will use with these three variables to calculate your mortgage payment.

It should be noted that the payment calculated by this formula is only the principal and the interest that you will have to pay each month. Virtually all residential mortgage lenders require borrowers to pay a pro-rated amount of their annual property taxes and insurance with their monthly payments, so if you’re calculating it by hand, remember to add one-twelfth of each of these expenses. And if your home comes with HOA fees, be sure to include that in your monthly housing expenses as well.

## What to know before buying a house in Oregon

Before entering into a purchase agreement on a home in Oregon, there are a few things to keep in mind. Not all are specific to Oregon, but all are worth knowing, especially if you’ve never been through the home buying process before.

### Oregon Property Taxes

Oregon property taxes on real estate are right in the middle of the pack, on par with the national average of about 1% of home value per year. The average homeowner in Oregon pays 0.97% of their home’s value in taxes annually, so on a \$500,000 home, that translates to a property tax bill of \$4,850. Of course, property taxes can vary a little in a state, but generally speaking, Oregon is not a high or low tax state.

### Oregon Home Insurance

Here’s some good news. According to Insurance.com, Oregon is one of the cheapest states in the country when it comes to insuring a home. The average home insurance premium is \$1,608 for \$300,000 of coverage, 30% lower than the national average. This can vary widely depending on the condition and features of the property, but home insurance rates in Oregon tend to be significantly lower than you’ll find elsewhere.

### Credit score requirements

Before you can qualify for a mortgage, you will need to prove that you have a stable employment history, as well as sufficient income to justify the loan. And you’ll also need to meet the lender’s credit score standards for the type of mortgage you’re applying for. This is usually a 580 for a low down payment FHA loan or a 620 for a conventional loan, but requirements may vary by lender.

### Rental Restrictions

In many areas there are restrictions on renting houses, especially short term. If you’re looking for an investment property, second home, or just want the ability to list your place on Airbnb or a similar platform when you’re not there, be sure to check local rental laws before buying.

## Tips for First-Time Home Buyers in Oregon

Like many other states, Oregon offers a program designed to help first-time home buyers afford a home, the Oregon Bond Home Loan Program. To qualify, you must be a first-time buyer, use a participating lender, complete a homebuyer education course, and have an income below the maximums set for the loan program.

There are two versions of the loan program: Cash Advantage and Rate Advantage. The Cash Advantage program is designed to give borrowers the lowest possible down payment, and the program provides up to \$15,000 in down payment and assistance with closing costs. The Rate Advantage program is designed to provide borrowers with the lowest possible mortgage rate – for example, at the start of March 2022, the national average 30-year mortgage rate was around 4.5%, while Rate Advantage loans had a rate of 3.25%.

Check the Oregon Housing and Community Services (OHCS) website for the most up-to-date information on these loan programs.