Compare Fixed-Rate Loan Costs
Two fixed-rate quotes, same principal: see which costs less over the whole term, upfront cash costs and the borrower MI months you enter included.
What This Calculator Does
Which of two lender quotes costs you less cash? Use this to compare mortgage offers that are both fixed-rate, fully amortizing and written on the same principal. Each loan runs to the end of its own term, counting cash fees paid a single time and any level monthly MI premium you supply for the first payments you enter. P&I shows separately from the opening payment with insurance. A gap within $1 is labeled "close", which doesn't mean the offers are identical.
Who Is This For
Borrowers and real estate pros can use it to check lender quotes that truly line up. Results rest on the note rates, terms, insurance details and cash fees you enter. They don't confirm approval or affordability, and they don't pick the best loan if you sell or refinance early.
How It Works
A and B borrow the same principal, so that amount is shared. For each loan, enter the fixed annual note rate, the length in years, the closing costs due in cash up front, the borrower's monthly MI premium, and how many initial payments carry that premium. If a quote adds no monthly premium, put 0 for the amount and 0 for the count, but only after you've verified it. You get the P&I payment for A and for B, the first payment with insurance included, and the total cost over the entire term for each loan. Each gap is A-minus-B, signed + or −.
Frequently Asked Questions
Which costs count when I compare mortgage offers with different terms?
Per offer, it adds the scheduled P&I over the loan's whole amortization to the cash fees you entered. MI joins in only through the first K payments, at the level monthly amount the borrower pays. Principal is shared, so it goes into the total just one time. Terms may differ on purpose, which makes this neither a payoff-on-the-same-date test nor a discounted-value study. Property taxes, the homeowner's policy and association dues are outside the math. So are income-tax benefits and every other ownership cost.
Can mortgage insurance flip which loan costs less?
Yes. The example shows how. Borrow a hypothetical $400,000. Offer A charges 6.5% over 30 years with no fees and adds up to $910,177.95 in P&I. Offer B charges 6.6% over 30 years, carries no added borrower MI, and lands at $919,668.70. On P&I alone, offer A comes out cheaper. Then A's quote brings a $150 premium for the first 96 payments, and that is $14,400 more. A now totals $924,577.95 and B is cheaper by $4,909.26, before the display reconciles its figures. With MI, the starting payment is $2,678.27 for A and $2,554.64 for B. These are made-up inputs, not market premiums, and 96 payments isn't a legal cancellation period.
Is the loan with the smaller monthly payment also the cheaper loan overall?
No. The smaller payment can belong to the loan that costs more in the end. Picture $400,000 and no monthly MI on either side. Loan A runs 6.5% for 30 years with $2,000 in cash fees, about $2,528.27 a month in P&I. Loan B runs 6% for 15 years with $4,000 in cash fees, about $3,375.43 a month. Add everything up across each term and A comes to $912,177.95 while B comes to $611,576.92. Whether the higher payment fits your budget, and what paying sooner is worth, get weighed separately.
Where do upfront fees and lender-paid insurance go in the form?
Put in the upfront box only what the loan makes you pay in cash, each item in just one place. Anything financed stays out. Mortgage insurance paid once, in cash, goes in this box as an upfront fee; don't invent a monthly premium for it as well. Third-party charges that hinge on the loan get added once they're quoted. Refundable escrow balances and double-counted items come out. If the lender covers MI through the quoted rate, the borrower's extra premium is 0, but only after you've confirmed that. Loans of different amounts, financed fees or credits that can't be matched belong in their own side-by-side study.
How should I read the number of insurance payments?
Think of K as a counter for premium months. If the borrower pays a level monthly premium, K is how many of the earliest scheduled payments carry it, anywhere from 1 to the term in years × 12. Without an extra premium, both the amount and K are 0. K isn't a valuation rule, isn't tied to loan-to-value, and isn't a cancellation calculation, so it can't promise an end date for MI. Premiums that decline, start late or vary need a different model. The first payment with MI is a starting figure. It isn't your permanent housing payment. Nor is it the whole housing payment.
What happens to a result that lands within $1?
It means no winner gets named. The tool flags A or B as lower only when the exact full-term difference tops $1. A gap of $0.99 is "close", exactly $1 is "close" too, and $1.01 is not. The + or − gap still shows on a close result, with A minus B turning positive whenever A is the pricier loan. "Close" doesn't mean the loans match, tie to the cent, are approved, or clear some universal finance bar. The $1 test happens before display rounding.
Is it fine to enter a 0% rate, or zero for the insurance?
Yes. A 0% rate and zero MI are both fine as inputs you were given or as a hypothetical quote, and neither says anything about market rates. Here's what a 0% rate does: the total P&I you pay equals the principal, and interest is exactly 0. Cash fees and quoted MI still cost real money, though. Take $120,000 at 0%. Over 10 years that's $1,000 a month; over 30 years it's roughly $333.33. Both terms repay $120,000 before fees and MI, since $120,000 is all principal. A blank field isn't the same as a confirmed zero. And with a principal of zero there is no loan to compare.
Do cents, rounding and left-out costs change which loan wins?
Rounding doesn't decide it, because the ranking runs on each loan's exact payments, interest and full-term cost. Amounts keep their cents and rates go up to four decimal places. A displayed total and a separately rounded gap can still differ by a cent, so don't rebuild the outcome from the rounded monthly figures. The tool is not a servicer statement, and it doesn't calculate APR, break-even, early payoff, NPV, equity, variable rates, income tax or loan approval. If you might sell or refinance before the term ends, or your payment stream looks different, that calls for a separate analysis.