Data Methodology
Last updated: April 2026
This page explains where the data behind our calculators and state pages comes from, the formulas we use, and the assumptions and limitations of our estimates. We aim for transparency so you can judge how much to trust the numbers.
What Our Calculators Estimate
Our calculators produce estimates of monthly mortgage payments, closing costs, affordability, and related figures. They are not loan offers, rate locks, or quotes. Real-world numbers depend on a specific lender's pricing, your specific financial profile, the property, and market conditions at the time you apply.
Mortgage Payment Formula
We calculate monthly principal and interest using the standard amortization formula:
M = P × (r × (1 + r)n) / ((1 + r)n − 1)
Where M is the monthly payment, P is the loan principal (purchase price minus down payment), r is the monthly interest rate (annual rate ÷ 12), and n is the total number of monthly payments (years × 12). Total monthly PITI adds estimated property taxes, homeowners insurance, mortgage insurance, and HOA dues where applicable.
Data Sources
Median Home Prices
State and city median home prices are sourced from public housing data (Census Bureau American Community Survey, FHFA House Price Index) and supplemented with industry data where appropriate. Numbers are rounded for readability. Actual median home prices vary by neighborhood, property type, and time period.
Property Tax Rates
State property tax rates represent effective average rates (annual tax as a percentage of home value). These are state-level averages — actual rates vary significantly by county, city, school district, and special assessment districts. Cities and counties may also offer homestead exemptions, senior exemptions, and other reductions we do not capture in our state-level data. Verify your specific rate with your local assessor before relying on it for major decisions.
Closing Costs
Average closing cost estimates by state are derived from industry surveys (Bankrate, ClosingCorp) and our own analysis. Closing costs typically include lender fees (origination, underwriting), third-party fees (appraisal, title search, title insurance), government fees (recording, transfer taxes), and prepaid items (escrow reserves). The percentages and dollar amounts we show are state averages, not site-specific quotes.
Transfer Taxes
State-level transfer tax rates reflect the most common rates in each state. Some states have city- or county-specific additional transfer taxes (e.g., New York City's additional NYC transfer tax beyond the state rate) that we do not break out. Verify your specific transfer tax with your title company or attorney.
Homeowners Insurance
State average homeowners insurance premiums are derived from NAIC (National Association of Insurance Commissioners) data and industry surveys. Actual premiums vary widely by carrier, coverage limits, deductible, home age, construction type, distance from coast or wildfire risk areas, and other factors. Our state averages are starting points for budgeting, not personalized quotes.
First-Time Buyer Programs
Down payment assistance program details (program name, basic eligibility, typical assistance amount) are sourced from state housing finance agency websites and HUD listings. Program details change annually based on funding. Contact the relevant state agency for current eligibility and application timelines.
Mortgage Rates
Default interest rates used in our calculators reflect typical 30-year fixed conventional mortgage rates as of the latest update. Rates change daily. Our defaults are not personalized quotes. Use Freddie Mac's Primary Mortgage Market Survey for current benchmark rates.
Default Assumptions
Our calculators use the following defaults unless otherwise noted:
• 30-year fixed loan term.
• 10% down payment (configurable per tool).
• Property tax rate: state effective average.
• Homeowners insurance: state average annual premium.
• Private Mortgage Insurance (PMI) at 0.5%–0.7% of the loan amount per year when down payment is less than 20%.
• No HOA dues by default (configurable).
Adjust the inputs to match your situation for an accurate estimate.
Limitations
State averages mask significant local variation. A state with a 1.1% average property tax rate may include counties with 0.6% rates and counties with 1.8% rates. Our calculators apply the state average to the home price you enter — they do not know the specific tax rate for the specific address. The same applies to insurance, closing costs, and home prices.
Our calculators do not currently model:
• Variable-rate adjustments after the introductory period on ARM loans.
• Interest-only payment periods.
• Lender-paid PMI structures.
• Specific state-level transfer tax exemptions (e.g., first-time buyer exemptions in some states).
• Buyer-specific factors like credit score-based rate adjustments (LLPAs).
Updates
We update default values, state data, and program details periodically. Articles and pages carry a "Last updated" date. If you see numbers that look significantly out of date, please email mortgagemathlab@gmail.com.
How to Verify Our Numbers
For any decision that depends on a specific number from our site, verify with primary sources:
• Property tax: your county assessor's website.
• Closing costs: a Loan Estimate from a licensed mortgage lender.
• Insurance: a quote from a licensed insurance agent or carrier.
• First-time buyer programs: your state housing finance agency.
• Mortgage rates: at least three current lender quotes.
Our numbers are educational starting points, not substitutes for primary-source verification.