Buying a loft or condo for sale in DTLA? Here’s what you need to know about what goes into those monthly mortgage payments you’ll be making.
What Does a Mortgage Payment Consist Of?
A mortgage payment – the money you send to your lender every month to repay your home loan – gets broken up into a few pieces once your lender receives it. Generally, it goes to:
- Loan repayment
- Real estate taxes
- Home insurance
- Private mortgage insurance
Loan Repayment in a Mortgage Payment
Most of your monthly mortgage payment will go toward repayment of your loan. That includes the principal amount (the amount you actually borrowed) and your interest (the amount the lender is charging you for borrowing money).
Real Estate Taxes in a Mortgage Payment
Part of your mortgage payment will most likely go into an escrow account to pay for your property taxes and other real estate taxes. However, make sure – you could be responsible for paying these separately.
Home Insurance in a Mortgage Payment
Your home insurance, which your lender will require, will typically go into an escrow account. Your lender will pay for your insurance from that account. Like taxes, though, you have to make sure – sometimes lenders don’t lump home insurance into the escrow account. If that happens, you have to pay it yourself.
Private Mortgage Insurance in a Mortgage Payment
If you put down less than 20 percent on a home, you’ll probably have to pay for private mortgage insurance, or PMI. The exception is if you used a VA loan, which doesn’t require borrowers to take out PMI. In most cases, this is tacked on to your monthly mortgage payment.
Are You Buying a Loft or Condo in DTLA?
Call us at 213-254-7626 or get in touch with us online to start exploring your options when you want to buy a loft or condo in downtown Los Angeles.
While you’re here, check out our:
- DTLA Arts District lofts for sale
- Historic Core lofts for sale
- DTLA Little Tokyo lofts for sale
- Bunker Hill lofts for sale
- City West lofts for sale
- South Park lofts for sale
- Fashion District lofts for sale
- Financial District lofts for sale