At a rate of 5.125% it comes out to approx $5.44 for every $1000.00 financed i.e. $220,000 = 220 (thousands) 222 x $5.44 = $1,196.80.  The actual Principal & Interest payment is $1,197.87.  Now the question is, when you say a payment of $1,200 are wanting to include Principal, Interest, Taxes & Insurance (PITI) and possible mortgage insurance if applicable ????

oops, meant:......220 x $5.44 = $1,196.80.  So as an example if you went to a loan of 225,000 it would then be: 225 x $5.44 = $1,224 and so on.

As the daughter of a Realtor I was always taught (I have owned 5 houses) that the mortgage can be generally calculated as 1% of the loan.  So, if the mortgage is $120,000 by the time you add in taxes & insurance your payment will be $1200.00 a month.

Now as a Mitigator Consultant (helping people get loan modifications - in other words lowering your interest rate on existing loans) I like to use the  calculator in the middle of this page http://calculators.interest.com/content/calculators/monthly-payment.asp to show my clients how their interest rate affects their monthly loan amount.  Hope it helps you too!

Jennifer

Jen, depends on the rate.  $120,000 X 360 X 5.125% = $653 pi, of course we dont know if buying or refi, MI or not. But if buying PITI would be approx $828 if buying in Ca and no mortgage insurance, with PMI would not make up the $372 difference and of course cost is tied to LTV and Fico etc...so if selling a home and buyer asked how much are the payments on a $120,000 home.....you might scare them away.