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The true cost of
your dream home
Banks show you the monthly payment. We show you the years of your life you'll spend working just to pay interest.
Your $350,000 home will actually cost you $848,125 over 30 years. That's $498,125 in interest, taxes, and insurance — or 5.7 years of full-time work just for interest alone.
The hidden cost of homeownership
Buying a home is the biggest financial decision most people ever make. But the price tag on the listing is just the beginning. A $350,000 home with a 30-year mortgage at 6.5% will actually cost you over $796,000 by the time you make your last payment. That means you pay more than double the home's value — with the extra money going to interest, property taxes, and insurance. Our Mortgage Reality Check calculator reveals this complete picture.
When you convert that interest cost into work hours, the numbers are staggering. At $30 per hour, the interest alone on a $350,000 home represents over 14,800 hours of work — that's more than 7 years of full-time employment spent exclusively paying the bank's profit on your home loan. Understanding this reality helps you make smarter decisions about how much to borrow, what term to choose, and how much to put down.
How does a mortgage work?
A mortgage is a loan secured by your property. You borrow money from a bank, and in return, you agree to make monthly payments over a set period (typically 15 or 30 years). Each monthly payment consists of four parts, often called PITI: Principal (paying down the loan balance), Interest (the bank's fee for lending), Taxes (property taxes collected by your local government), and Insurance (homeowner's insurance protecting the property). In the early years, the vast majority of your payment goes toward interest rather than building equity. This is why our calculator's amortisation chart is so eye-opening.
How to save money on your mortgage
The most powerful lever is your down payment. A larger down payment means a smaller loan, less interest, and no private mortgage insurance (PMI) if you put down 20% or more. Choosing a 15-year term instead of 30 years can save you hundreds of thousands in interest, though your monthly payment will be higher. Making even one extra payment per year can shave years off your mortgage. Refinancing when rates drop can also deliver significant savings. Use our calculator to test different scenarios and find the sweet spot between affordable monthly payments and minimum total cost.
Frequently Asked Questions
How much should I put down on a house?
The traditional recommendation is 20% to avoid private mortgage insurance (PMI). However, many buyers put down 3-10%. Use our calculator to see how different down payment percentages affect your total cost. A larger down payment means less interest paid over the life of the loan, but it also means less cash available for other investments or emergencies.
Is a 15-year or 30-year mortgage better?
A 15-year mortgage has higher monthly payments but saves you a massive amount in total interest. A 30-year mortgage has lower monthly payments but costs significantly more over time. The right choice depends on your income, budget, and financial goals. Our calculator lets you compare both scenarios side-by-side.
What costs beyond the mortgage should I budget for?
Homeownership includes property taxes (typically 0.5-2.5% of home value per year), homeowner's insurance ($1,000-$3,000+ per year), maintenance and repairs (budget 1-2% of home value annually), HOA fees if applicable, and utilities. Our calculator includes property taxes and insurance so you can see a more complete picture of your monthly costs.
How accurate is this mortgage calculator?
Our calculator uses the same fixed-rate amortisation formulas used by banks and mortgage lenders. The results are accurate for fixed-rate mortgages. Adjustable-rate mortgages (ARMs), special loan programs (FHA, VA), and location-specific costs may vary. Always get official quotes from lenders for final numbers.
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