How Much Does Your Mortgage REALLY Cost?

Do you know your best choice when choosing a mortgage?

A few years ago, in 2007, we bought our first home. The process was draining and complex.

But we did it.

We got what was the best possible deal at the time, going through an income audit to prove we were “worthy” of the lowest mortgage rate. Last week, we closed on a refinance, after a process that included a lot of documentation to prove — on my self-employed income — that we could handle the loan.

In our situation, getting a mortgage (or a refinance) is more about shopping around and seeing who’s willing to work with us because of our income situation.

However, if you have a more conventional situation, shopping around should also include a thorough going-over of the fees and interest, and understanding which is likely to be your best deal over the life of your loan.

Comparing Mortgage Costs

Comparing mortgage costs can be a little daunting, especially if you aren’t really sure how fees and interest rates interact to create the bigger picture. If you want to compare those items, my buddies and Mortgage Bloom have put together an interesting widget that allows you to compare loan terms — and then makes a recommendation for you.

Mortgage Calculator powered by MortgageBloom


Nikhil Bobb, the co-founder of Mortgage Bloom, points out that this widget also takes into account the time value of money by taking into account what you could get for a high-yield CD earning 2% APY.

Once you enter the information into the widget, you can get an idea of which mortgage really does cost you less over the life of your loan. It’s a helpful tool, and one that you can employ to really compare apples to apples. It does the math for you, and helps you get the best bang for your buck.

What do you think? How do you compare costs and avoid mortgage pitfalls?

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