Abodemic

Methodology & Sources

Last updated June 1, 2026

Abodemic's calculators are built on standard, published financial math — the same formulas lenders use. We show our work here so you can verify every number. All calculations run in your browser; we never see or store your inputs.

Monthly payment & amortization

The principal-and-interest payment uses the standard amortization (annuity) formula: M = P · r / (1 − (1 + r)⁻ⁿ), where P is the loan amount, r is the monthly rate (annual rate ÷ 12), and n is the number of monthly payments. Each month, interest is charged on the remaining balance and the rest of the payment reduces principal. We reconcile the final payment so the balance lands at exactly $0, the way a real servicer does.

Property tax, insurance & escrow

Your full monthly payment (PITI) adds 1/12 of annual property tax, 1/12 of annual homeowners insurance, and any HOA dues to principal and interest. On the state pages we estimate property tax from each state's effective rate (median property tax ÷ median home value) and insurance from a national average; you can override both with your own figures.

PMI (private mortgage insurance)

PMI applies to conventional loans when your down payment is under 20% (loan-to-value above 80%). We estimate the annual premium as a percentage of the loan based on your LTV, and — per the federal Homeowners Protection Act — automatically drop it once the balance reaches 78% of the home's original value.

Affordability (debt-to-income)

The affordability calculator finds the largest home price whose full monthly payment keeps you within two limits: a front-end ratio (housing ÷ gross income) of 28% and a back-end ratio (all debt ÷ gross income) of 43% — the Qualified Mortgage benchmark. We solve for price numerically and round down to a clean figure so we never overstate what you can afford.

Refinance & payoff

The refinance calculator compares your current loan over its remaining term to a new loan, reporting monthly savings, the breakeven month (when savings recoup closing costs), and the lifetime-interest difference. The payoff calculator simulates the schedule month by month to show how extra principal or biweekly payments shorten the term.

Default rate & cost data — sources

We refresh rate and cost data on a regular cadence and date every page. These defaults are starting points — your actual rate, taxes, and insurance depend on your lender, location, and credit. Abodemic's results are estimates for educational purposes, not loan offers or financial advice.