Best for buyers with credit card debt, personal loans, auto loans, home equity from a sale, or cash available but unsure how to use it.

Your Numbers

Next home purchase price

Available cash / equity

Cash reserves to keep after closing

Est. taxes + insurance + HOA (monthly)

Mortgage term (years)

Baseline mortgage rate

PMI factor (annual, applies when LTV > 80%)

Current Debts

Debt name

Balance

Rate

Monthly

High-priority debt This debt may be significantly increasing your monthly cost.

Debt name

Balance

Rate

Monthly

Moderate-cost debt

Your Results

Debt Payoff Wins

You could save about $698/month by paying off debt first.

The monthly debt payments you'd wipe out are larger than the extra mortgage cost from borrowing a bit more.

Based on your debt payments, interest rates, mortgage amount, and cash reserves.

Per year

$8,378

Over 5 years

$41,890

Break-even rate

9.20%

Calculator compares pre-tax cash flow only.

Break-Even Mortgage Rate

9.198%

How high your mortgage rate could go before the strategy stops saving you money. If your actual rate stays below this number, paying off debt first still leaves you ahead each month.

What if your rate changed?

Move the slider to see how the Pay Debt First strategy responds at a different mortgage rate.

6.750%

4.500%Break-even: 9.198%10.500%

Pay Debt First mortgage

$3,408.34

Pay Debt First total

$3,408.34

Monthly savings

$698.17

5-year impact

$41,890

Side-by-Side Comparison

Winning column is highlighted.

Pay Debt First

Winner

Mortgage principal & interest: $2,659.25
PMI: $99.08
Taxes / insurance / HOA: $650.00
Remaining debt payments: $0.00
Total monthly obligation: $3,408.34

Larger Down Payment

Mortgage principal & interest: $2,464.67
PMI: $91.83
Taxes / insurance / HOA: $650.00
Remaining debt payments: $900.00
Total monthly obligation: $4,106.51

Monthly savings$698.17

Annual savings$8,378

5-year cash-flow difference$41,890

	Pay Debt First ★	Larger Down Payment
Mortgage principal & interest	$2,659.25	$2,464.67
PMI	$99.08	$91.83
Taxes / insurance / HOA	$650.00	$650.00
Remaining debt payments	$0.00	$900.00
Total monthly obligation Principal & interest + PMI + taxes/insurance/HOA + remaining debt payments	$3,408.34	$4,106.51
Monthly savings	$698.17	—
Annual savings	$8,378	—
5-year cash-flow difference	$41,890	—

Liquidity Check

2.9 months of reserve

Low reserve

This strategy may improve cash flow, but it may leave limited emergency reserves. Consider increasing the reserves you keep after closing.

Opportunity Cost

A simple, pre-tax view of interest avoided vs. interest added by borrowing more.

First-year interest avoided (debt)

$3,990

5-year interest avoided (debt)

$11,970

Added mortgage interest — year 1

$2,025

Added mortgage interest — 5 years

$9,619

Net estimated benefit — 5 years$2,351

Want me to review your numbers personally?

This calculator gives you the estimate. I'll help you compare real loan options, payment structure, PMI, qualification, and refinance strategy.

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This is an educational estimate, not a loan approval, loan estimate, or commitment to lend. Rates, PMI, taxes, insurance, qualification, and available loan programs may vary.