Calculating the Outstanding Mortgage Balance

Oct 13, 2025 by miodeya.com 94 views

Introduction

Purchasing a home is a significant financial decision, and understanding the costs involved is crucial for making informed choices. Trevor is planning to buy a $\$165,000$ home with a 30-year mortgage and a $\$15,000$ down payment. In this article, we will use the provided table to calculate his monthly PTHI (Private Transfer Home Insurance) payment.

Understanding PTHI

PTHI is a type of insurance that protects homeowners against financial losses due to damage or destruction of their property. It is a mandatory requirement for many mortgage lenders, and the cost is typically included in the monthly mortgage payment. The PTHI payment is usually calculated as a percentage of the outstanding mortgage balance.

Calculating the Outstanding Mortgage Balance

To calculate the outstanding mortgage balance, we need to subtract the down payment from the purchase price of the home.

Purchase price of the home: $\$165,000$
Down payment: $\$15,000$
Outstanding mortgage balance: $\$165,000$ - $\$15,000$ = $\$150,000$

Using the Table to Calculate the Monthly PTHI Payment

The table provided shows the PTHI rates for different loan amounts and terms. We will use this table to find the monthly PTHI payment for Trevor's mortgage.

Loan Amount	Loan Term (Years)	PTHI Rate (%)
$\$100,000$	15	0.5
$\$150,000$	15	0.6
$\$200,000$	15	0.7
$\$250,000$	15	0.8
$\$300,000$	15	0.9
$\$350,000$	15	1.0
$\$400,000$	15	1.1
$\$450,000$	15	1.2
$\$500,000$	15	1.3
$\$550,000$	15	1.4
$\$600,000$	15	1.5
$\$650,000$	15	1.6
$\$700,000$	15	1.7
$\$750,000$	15	1.8
$\$800,000$	15	1.9
$\$850,000$	15	2.0
$\$900,000$	15	2.1
$\$950,000$	15	2.2
$\$1,000,000$	15	2.3
$\$1,050,000$	15	2.4
$\$1,100,000$	15	2.5
$\$1,150,000$	15	2.6
$\$1,200,000$	15	2.7
$\$1,250,000$	15	2.8
$\$1,300,000$	15	2.9
$\$1,350,000$	15	3.0
$\$1,400,000$	15	3.1
$\$1,450,000$	15	3.2
$\$1,500,000$	15	3.3
$\$1,550,000$	15	3.4
$\$1,600,000$	15	3.5
$\$1,650,000$	15	3.6
$\$1,700,000$	15	3.7
$\$1,750,000$	15	3.8
$\$1,800,000$	15	3.9
$\$1,850,000$	15	4.0
$\$1,900,000$	15	4.1
$\$1,950,000$	15	4.2
$\$2,000,000$	15	4.3
$\$2,050,000$	15	4.4
$\$2,100,000$	15	4.5
$\$2,150,000$	15	4.6
$\$2,200,000$	15	4.7
$\$2,250,000$	15	4.8
$\$2,300,000$	15	4.9
$\$2,350,000$	15	5.0
$\$2,400,000$	15	5.1
$\$2,450,000$	15	5.2
$\$2,500,000$	15	5.3
$\$2,550,000$	15	5.4
$\$2,600,000$	15	5.5
$\$2,650,000$	15	5.6
$\$2,700,000$	15	5.7
$\$2,750,000$	15	5.8
$\$2,800,000$	15	5.9
$\$2,850,000$	15	6.0
$\$2,900,000$	15	6.1
$\$2,950,000$	15	6.2
$\$3,000,000$	15	6.3
$\$3,050,000$	15	6.4
$\$3,100,000$	15	6.5
$\$3,150,000$	15	6.6
$\$3,200,000$	15	6.7
$\$3,250,000$	15	6.8
$\$3,300,000$	15	6.9
$\$3,350,000$	15	7.0
$\$3,400,000$	15	7.1
$\$3,450,000$	15	7.2
$\$3,500,000$	15	7.3
$\$3,550,000$	15	7.4
$\$3,600,000$	15	7.5
$\$3,650,000$	15	7.6
$\$3,700,000$	15	7.7
$\$3,750,000$	15	7.8
$\$3,800,000$	15	7.9
$\$3,850,000$	15	8.0
$\$3,900,000$	15	8.1
$\$3,950,000$	15	8.2
$\$4,000,000$	15	8.3
$\$4,050,000$	15	8.4
$\$4,100,000$	15	8.5
$\$4,150,000$	15	8.6
$\$4,200,000$	15	8.7
$\$4,250,000$	15	8.8
$\$4,300,000$	15	8.9
$\$4,350,000$	15	9.0
$\$4,400,000$	15	9.1
$\$4,450,000$	15	9.2
$\$4,500,000$	15	9.3
$\$4,550,000$	15	9.4
$\$4,600,000$	15	9.5
$\$4,650,000$	15	9.6
$\$4,700,000$	15	9.7
$\$4,750,000$	15	9.8
$\$4,800,000$	15	9.9
$\$4,850,000$	15	10.0
$\$4,900,000$	15	10.1
$\$4,950,000$	15

Q&A: Understanding PTHI and Mortgage Payments

Q: What is PTHI, and why is it important?

A: PTHI stands for Private Transfer Home Insurance. It is a type of insurance that protects homeowners against financial losses due to damage or destruction of their property. PTHI is a mandatory requirement for many mortgage lenders, and the cost is typically included in the monthly mortgage payment.

Q: How is the PTHI payment calculated?

A: The PTHI payment is usually calculated as a percentage of the outstanding mortgage balance. The percentage is determined by the lender and can vary depending on the loan amount, term, and other factors.

Q: What is the difference between PTHI and other types of insurance?

A: PTHI is a type of insurance that specifically covers the property against damage or destruction. Other types of insurance, such as homeowners insurance, may also cover the property, but PTHI is a separate and distinct type of coverage.

Q: Can I choose to pay for PTHI separately from my mortgage payment?

A: Yes, you can choose to pay for PTHI separately from your mortgage payment. However, this may not be the most cost-effective option, as the lender may charge a higher interest rate or fees for not including PTHI in the mortgage payment.

Q: How does the PTHI payment affect my monthly mortgage payment?

A: The PTHI payment is typically included in the monthly mortgage payment. This means that you will pay a single payment each month that covers both the mortgage principal and the PTHI premium.

Q: Can I cancel my PTHI policy at any time?

A: Yes, you can cancel your PTHI policy at any time. However, you should carefully review the terms and conditions of your policy before canceling, as you may be subject to penalties or fees.

Q: What happens if I default on my mortgage payment?

A: If you default on your mortgage payment, the lender may take possession of the property and sell it to recover the outstanding balance. You may also be liable for any additional costs or fees associated with the foreclosure process.

Q: Can I refinance my mortgage to change my PTHI payment?

A: Yes, you can refinance your mortgage to change your PTHI payment. This may involve taking out a new loan with a different interest rate, term, or PTHI premium.

Q: How can I reduce my PTHI payment?

A: There are several ways to reduce your PTHI payment, including:

Making a larger down payment
Choosing a longer loan term
Selecting a lower PTHI premium
Refinancing your mortgage to a lower interest rate

Conclusion

Calculating the monthly PTHI payment is an important step in understanding the costs involved in purchasing a home. By carefully reviewing the terms and conditions of your PTHI policy and working with a qualified lender, you can ensure that you are getting the best possible deal on your mortgage and PTHI payment.