How Much a $1,000,000 Mortgage Will Cost You – Credible News

December 26, 2021 By admin

A 30-year, $1,000,000 mortgage with a 4% interest rate costs about $4,774 per month — and you could end up paying over $700,000 in interest over the life of the loan.
Amy Fontinelle

Amy Fontinelle is a mortgage and credit card authority and a contributor to Credible. Her work has appeared in Forbes Advisor, The Motley Fool, Investopedia, International Business Times, MassMutual, and more.

Read more” > Amy Fontinelle Edited by <a href="" class="entry-meta__tooltip" data-tooltipjs="" data-tooltipjs-hover="true" data-tooltipjs-placement="top" data-tooltipjs-close-on-outside-click="true" data-tooltipjs-title="Credible’s editing process includes rigorous fact-checking by experts to ensure that all content is accurate and up-to-date. This article has been reviewed, edited, and fact-checked by Chris Jennings. As a Credible authority on mortgages, Chris covers topics including home loans and mortgage refinancing. His work has appeared in Fox Business and GOBankingRates.Read more” > Chris Jennings Updated August 17, 2021
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A $1,000,000 mortgage could be your ticket to a Midwestern mansion — or a Bay Area bungalow. Whatever type of home you’re after, a substantial income and top-notch credit can help you get the jumbo mortgage you need.
In addition to your down payment, you’ll need money to cover the loan origination fee, home appraisal, and other closing costs. But here, we’ll focus on the monthly payment you can expect under different scenarios as well as how much a $1,000,000 mortgage might cost in the long run.
If you’re applying for a $1,00,000 mortgage, here’s how much that loan should cost you each month with interest:

Monthly mortgage payments are based on how much you borrow, what interest rate you can get, and how long you want to borrow the money for.
Your payment will include principal, interest, and other costs like property taxes and homeowners insurance.
Here’s what monthly payments for a $1,000,000 fixed-rate mortgage might look like for you:
To get an idea of what your monthly payment might be, input your mortgage amount, interest rate, and loan term into our mortgage payment calculator.
Enter your loan information to calculate how much you could pay
With a $ home loan, you will pay $ monthly and a total of $ in interest over the life of your loan. You will pay a total of $ over the life of the mortgage.
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You can get a home loan from many types of mortgage lenders, including retail lenders, portfolio lenders, and credit unions.
Traditionally, you’d have to contact each lender individually to get a quote, which could be time consuming and tedious. Credible makes this process more efficient. We help you compare rates from our partner lenders without affecting your credit score, and we won’t sell your data or spam you with offers.
Find a rate that’s right for you and get prequalified in just a few minutes.
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A $1,000,000 mortgage is considered a jumbo loan, and these loans are a bit different from the smaller conforming loans you more often read about. Qualifications can vary a lot from one lender to the next, but here’s what you’ll typically need:
Learn: How Long It Takes to Buy a House
You’ll always pay more in interest with a longer loan term, and a $1,000,000 jumbo loan is no exception. For instance, a 30-year jumbo mortgage will give you the lowest monthly payment, but you’ll cough up $718,695 in interest, assuming a fixed rate of 4%.
A 15-year mortgage at the same rate will cost you $331,438 in interest, but it’ll require a higher monthly payment.
Cutting your mortgage term in half could save you $387,257 in interest. However, sticking with a 30-year term gives you an extra $2,623 to put toward other goals and expenses each month.
There’s no right or wrong choice, so choose what works best for you. Plus, Credible can help you find a great rate on a home loan in minutes and put you on the path to pre-approval.
Find Rates Now

See: How Much Does It Cost to Buy a Home in 2021?
A mortgage amortization schedule plans out your payments for each month of your mortgage term.
Most of your monthly payment will go toward interest at the beginning of your loan term. But with each payment you make, a little more will go toward principal and a little less will go toward interest, until you own your home free and clear.
Here’s what that looks like for a 30-year, $1,000,000 mortgage with a 4% fixed rate:
And here’s the amortization schedule on a 15-year, $1,000,000 mortgage with a 4% fixed rate:
Learn: How to Buy a House: Step-by-Step Guide

how to get a mortgage flowchart-square
To figure out how much house you can afford, create a detailed account of your annual income and expenses. Then, factor in the new costs you’ll take on as a homeowner.
Besides your mortgage principal and interest, there will be property taxes, homeowners insurance, and home maintenance. Some properties also require homeowners association fees and special hazard insurance, such as flood insurance. Your utilities may be higher, too.
Before you apply for a mortgage, check your credit report with each of the three major credit bureaus: Equifax, Experian, and TransUnion. Mistakes can happen due to identity theft, identically spelled names, and similar Social Security numbers.
You don’t want to qualify for a smaller loan because someone else’s car payment ended up on your credit profile, or get rejected because your score is lower than you thought.
By giving lenders some basic information about your finances, they’ll be able to tell you if you’re likely to qualify for a full mortgage — and estimate how much you can borrow.
The mortgage pre-approval process also helps you learn which lender offers the lowest fees and APR.
Tip: Getting a pre-approval letter from a lender will strengthen your purchase offer too. It shows sellers that you’re more likely to close the deal.
When you’re taking out a jumbo loan, a small difference in your interest rate can mean a difference of tens of thousands of dollars over the life of your mortgage. It’s worth your time and effort to shop around for the best mortgage rate.
But don’t stop there: Fees can add up too. When comparing lenders, see what they charge in origination fees, application fees, discount points, and more.
Don’t let the fact that you’re making a major purchase dissuade you from trying to save money any way you can. In a buyer’s market, you may be able to offer less than the asking price — or negotiate seller concessions, such as help paying for closing costs or repairs.
If that’s not possible, negotiating for your desired move-in date might help you save money by avoiding overlapping payments on your current place and new home.
Find Out: How to Know If You Should Buy a House in 2021
Once you’ve found a home you want to buy and a seller has accepted your offer, it’s time to apply for a mortgage. You’ll provide extensive details about your income sources and your legally binding financial obligations, including debt payments and child support.
The lender wants to see that your income is stable and that your debt-to-income ratio is not too high to afford the mortgage you’re applying for.
After you complete your mortgage application, an underwriter will review it along with supporting documents you must supply, such as bank statements, pay stubs, and tax returns. The faster you provide this additional information, the sooner your mortgage can close.
The lender will also send an appraiser out to evaluate the condition and value of the home you want to buy. If all goes well, it will appraise for the purchase price or higher.
Getting to closing can be excruciating. You can’t wait to get that final OK that you’re clear to close.
At this stage, you may have to comply with some last-minute underwriting requests. You’ll also want to schedule time to review and sign your closing paperwork and make sure you understand how to transfer the money for your down payment and closing costs.
To complete your homebuying journey, you’ll sign dozens of papers in front of a notary. This process traditionally took place in an office, but now you may be able to do it in your home with a mobile notary or remote online notarization.
You’ll need to provide your ID and possibly your fingerprint. Soon after that, you’ll get the keys — and the real excitement of moving into your new home can finally begin!
Amy Fontinelle is a mortgage and credit card authority and a contributor to Credible. Her work has appeared in Forbes Advisor, The Motley Fool, Investopedia, International Business Times, MassMutual, and more.
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