How the Math Works
The calculators share one amortization engine, so the Mortgage Modeler, the quick calculators and the embedded versions always agree with each other. These are the rules it follows.
Amortization, month by month
Every schedule is built one payment at a time from the standard amortization formula, with interest charged monthly on the remaining balance. Extra payments, whether a recurring monthly amount or a one-time lump sum, go straight to principal in the month you make them, so the interest saved compounds the way it does on a real loan. Nothing is approximated with annual shortcuts.
PMI comes off at 80% of the original price
Private mortgage insurance is removed when your balance reaches 80% of what you paid, not 80% of what the home might be worth today. That is the date you can actually request cancellation, and it is the one most calculators get wrong. Appreciation still shows up in your equity, it just does not move the PMI date.
FHA mortgage insurance is not PMI
FHA loans are modeled with their own rules: with less than 10% down, the mortgage insurance premium runs for the life of the loan; with 10% or more down, it runs at least 11 years. Treating FHA insurance like PMI makes FHA look tens of thousands of dollars cheaper than it is.
ARMs follow a rate path you choose
Adjustable-rate loans hold the intro rate for the fixed period, then adjust once a year along a path you set, never moving more than one percentage point in a year, never above your lifetime cap, and never below zero. The payment is re-amortized over the remaining term every time the rate changes, the same way a lender recalculates it.
Affordability uses lender ratios, at three levels
Home price ranges are worked out from debt-to-income ratios on gross income: conservative (25% housing / 33% total debt), traditional (28% / 36%), and maximum (43% / 50%). The maximum is what some lenders will approve, not a recommendation.
What it can't know
The results are only as good as the inputs. Iota-Home doesn't know your credit score, your lender's fees, how your property taxes or insurance will change, or what rates will do. Use it to understand your options and pressure-test a decision, then confirm the specifics with your lender before you act. If you want to see the reasoning behind the numbers, the Learn section walks through it.
Found something off?
If a number looks wrong or there's a scenario the tools can't model yet, I want to hear about it.
contact@iota-home.com