The true monthly cost of owning a home, line by line

The seven lines

Principal and interest. This is the loan payment itself. On a fixed-rate loan it stays the same for the life of the loan. On an adjustable-rate loan it can change after the fixed period ends.

Property tax. Your county or city sets it, and it is usually collected through an escrow account. The CFPB explains that many lenders require escrow for taxes and insurance, so the servicer collects a share each month and pays the bills when they come due.

Homeowners insurance. Your lender requires it, and it is usually paid through escrow too. The premium can change at every renewal.

Mortgage insurance. Most conventional loans with less than 20 percent down carry private mortgage insurance. FHA loans carry their own mortgage insurance premium. The CFPB explains that borrower-paid PMI on a conventional loan can end, by request or automatically, once the balance falls far enough.

Association dues. Condos, townhomes and many subdivisions charge them. Dues can rise, and associations can add special assessments.

Utilities. Water, sewer, trash, gas, electricity and internet may all be in your name now, including some a landlord used to pay.

Upkeep and repairs. Nobody sends a bill for these until something breaks.

What the lender counts and what it does not

The lender adds the first five lines to get the housing payment it uses in your debt-to-income ratio. It does not count utilities or repairs, so a loan approval does not prove the house is affordable. It only shows that the first five lines fit the lender's ratio limits.

That gap matters most for first-time buyers. They are often moving from a rental where the landlord paid water, trash and repairs, into a house where the buyer pays everything.

Where to find a real number for each line

Principal and interest. Use a Loan Estimate for the actual loan amount and rate. The CFPB's explainer shows where the payment appears on page 1 and how it is broken down on page 2. Online ads usually assume a large down payment and excellent credit.

Property tax. Look up the current bill on the county assessor's or treasurer's site. In many places a sale can trigger a reassessment, and the seller's exemptions may not carry over to you. Ask the county how a sale affects the next bill, and use that figure rather than the seller's bill.

Insurance. Ask an agent or insurer for a quote on the specific address before you finalize the offer. The Utah Insurance Department points out that the coverage and deductible you choose affect the premium, so compare quotes with the same coverage.

Mortgage insurance. Page 2 of the Loan Estimate shows the monthly amount. It depends on your credit, down payment and loan type.

Dues. Ask for the current budget and minutes. They show approved increases and any assessments under discussion.

Utilities. Ask the seller for a year of bills or call the utility companies. Many utilities can give an average for an address.

Repairs. HUD's home inspection notice says a home inspector estimates the remaining useful life of major systems, equipment and finishes. Use those estimates. If the roof has five years left and replacement would cost $15,000, that is $250 a month you need to start saving.

Lines that change after the first year

Principal and interest on a fixed-rate loan stay put. Most other lines do not. The CFPB notes that tax and insurance changes flow through to the escrow payment, so the monthly payment can change even on a fixed-rate loan. Each year the servicer reviews the escrow account and may raise the payment to cover a shortage.

Plan for that. If you buy at the very top of what the lender allows, a modest tax or insurance increase can push the payment past what you are comfortable with. Leave room in the budget, or build a cushion in savings for the first escrow review.

Using the number

Run the calculator with the price, down payment and rate from a Loan Estimate, and put your tax, insurance, mortgage insurance and dues in the last field. Then add utilities and your repair set-aside yourself. Compare the total with what you pay now for rent, renters insurance and utilities, not with the rent alone. If the gap is larger than you expected, it is better to find out now than at the first escrow review.