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Over the life of a $350,000 mortgage with a 7% interest rate, borrowers could expect to pay from $216,229 to $488,233 in total interest, depending on whether they opt for a 15-year or 30-year loan term. But the actual cost of a mortgage depends on several factors, including the interest rate, and whether you have to pay private mortgage insurance.

Besides interest, homebuyers need to account for a down payment, closing costs, and the long-term costs of taxes and insurances that are included in a $350,000 mortgage payment.

Cost of a $350,000 Mortgage

When you finance a home purchase, you have to pay back more than the borrowed amount, known as the loan principal. The total cost of taking out a $350,000 mortgage is $838,281 with a 30-year term at a 7% interest rate. This comes out to $488,233 worth of interest, assuming there aren’t any late monthly mortgage payments or pre-payments.

When you buy a home, there are usually some upfront costs you’ll have to pay, too. Mortgages often require a down payment, calculated as a percentage of home purchase price, that’s paid out of pocket to secure financing from a lender. The required amount varies by loan type and lender, but average down payments range from 3% – 20%.

Closing costs, including home inspections, appraisals, and attorney fees, represent another upfront cost for real estate transactions. They typically sum up to 3% to 6% of the loan principal, or $10,500 to $21,000 on a $350,000 mortgage.

The total down payment on $350,000 mortgages also impacts the total cost of taking out a home loan. Unless buyers put 20% or more down on a home purchase, they’ll have to pay private mortgage insurance (PMI) with their monthly mortgage payment. The annual cost of PMI is generally between 0.5% – 1.5% of the loan principal. Borrowers can get out of paying PMI with a mortgage refinance or when they reach 20% equity in their home. If this is your first time in the housing market, consider reading up on tips to qualify for a mortgage.


💡 Quick Tip: When house hunting, don’t forget to lock in your home mortgage loan rate so there are no surprises if your offer is accepted.

Monthly Payments for a $350,000 Mortgage

The monthly payment on a $350K mortgage won’t always be the same amount. You’ll need to factor in your down payment, interest rate, and loan term to estimate your $350,000 mortgage monthly payment.

With a 30-year loan term and 7% interest rate, borrowers can expect to pay around $2,328 a month. Whereas a 15-year term at the same rate would have a monthly payment of approximately $3,146. However, these estimates only account for the loan principal and interest. Monthly mortgage payments also include taxes and insurances, but these costs can differ considerably by location and based on a home’s assessed value.

There are also different types of mortgages to consider. Whether you opt for a fixed vs adjustable-rate mortgage, for instance, will affect your monthly payment.

To get a clearer idea of what your monthly payment might be with different down payments and loan terms, try using a mortgage calculator.

Recommended: Best Affordable Places to Live in the U.S.

Where to Get a $350,000 Mortgage

Homebuyers have many options in terms of lenders, including banks, credit unions, mortgage brokers, and online lenders.

The homebuying process can be stressful, so it may be tempting to go with the first mortgage offer you receive. However, shopping around and getting loan estimates from multiple lenders lets you choose the one that’s the most competitive and cost-effective.

Even a fraction of a percentage point difference on an interest rate can add up to thousands in savings over the life of a mortgage. Besides the interest rate, assess the fees, terms, and closing costs when comparing mortgage offers.

Recommended: Home Loan Help Center

What to Consider Before Applying for a $350,000 Mortgage

When taking out a mortgage, it’s important to consider the total cost of the loan. You’ll need cash on hand for a down payment and closing costs, plus sufficient income and funds to cover the monthly payment and other homeownership costs.

Before applying for a $350,000 mortgage, crunching the numbers in a housing affordability calculator can give a better understanding of how these costs will work with your finances.

It’s also helpful to see how $350,000 mortgage monthly payments are applied to the loan interest and principal over the life of the loan. The majority of the monthly mortgage payment goes toward interest rather than paying off the loan principal, as demonstrated by the amortization schedules below.

Here’s the mortgage amortization schedule for a 30-year $350,000 mortgage with a 7% interest rate — which would amount to $488,233 in interest. For comparison, we’ve also included the mortgage amortization schedule for a 15-year $350,000 mortgage with a 7% interest rate. A $350,000 mortgage payment, 15 years’ out, would add up to $216,229 in interest. When weighing a 30-year vs 15-year loan term, the shorter loan term carries a higher monthly payment but less than half the total interest over the life of the loan.

Amortization Schedule, 30-year Mortgage at 7%

Year	Beginning Balance	Total Interest Paid	Total Principal Paid	Remaining Balance
1	$350,000	$24,386	$3,555	$346,425
2	$346,425	$24,129	$3,812	$342,613
3	$342,613	$23,853	$4,088	$338,525
4	$338,525	$23,558	$4,383	$334,142
5	$334,142	$23,241	$4,700	$329,442
6	$329,442	$22,901	$5,040	$324,402
7	$324,402	$22,537	$5,404	$318,998
8	$318,998	$22,146	$5,795	$313,203
9	$313,203	$21,717	$6,214	$306,989
10	$306,989	$21,278	$6,663	$300,326
11	$300,326	$20,796	$7,145	$293,182
12	$293,182	$20,280	$7,661	$285,520
13	$285,520	$19,726	$8,215	$277,306
14	$277,306	$19,132	$8,809	$268,497
15	$268,497	$18,496	$9,446	$259,051
16	$259,051	$17,813	$10,128	$248,923
17	$248,923	$17,081	$10,861	$238,062
18	$238,062	$16,295	$11,646	$226,417
19	$226,417	$15,454	$12,488	$213,929
20	$213,929	$14,551	$13,390	$200,539
21	$200,539	$13,583	$14,358	$186,181
22	$186,181	$12,545	$15,396	$170,784
23	$170,784	$11,432	$16,509	$154,275
24	$154,275	$10,238	$17,703	$136,573
25	$136,573	$8,959	$18,982	$117,590
26	$117,590	$7,586	$20,355	$97,236
27	$97,236	$6,115	$21,826	$75,409
28	$75,409	$4,537	$23,404	$52,006
29	$52,006	$2,845	$25,096	$26,910
30	$26,910	$1,031	$26,910	$0

Amortization Schedule, 15-year Mortgage at 7%

Year	Beginning Balance	Total Interest Paid	Total Principal Paid	Remaining Balance
1	$350,000	$24,065	$13,684	$336,296
2	$336,296	$23,076	$14,673	$321,624
3	$321,624	$22,015	$15,733	$305,890
4	$305,890	$20,878	$16,871	$289,020
5	$289,020	$19,658	$18,090	$270,929
6	$270,929	$18,351	$19,398	$251,531
7	$251,531	$16,948	$20,800	$230,731
8	$230,731	$15,445	$22,304	$208,427
9	$208,427	$13,832	$23,916	$184,510
10	$184,510	$12,103	$25,645	$158,865
11	$158,865	$10,249	$27,499	$131,366
12	$131,366	$8,261	$29,487	$101,879/td>
13	$101,879	$6,130	$31,619	$70,260
14	$70,260	$3,844	$33,904	$36,355
15	$36,355	$1,393	$36,355	$0

Recommended: The Cost of Living By State

How to Get a $350,000 Mortgage

To qualify for a $350,000 mortgage, borrowers will need to meet the income, credit, and down payment requirements. It’s also important to have an adequate budget for long-term housing costs and other financial goals and obligations like savings and debt.

Using the 28/36 rule, a monthly mortgage payment shouldn’t be more than 28% of your monthly gross income and 36% of your total debt to be considered affordable. With a $2,328 monthly mortgage payment, you’d need a minimum gross monthly income of at least $8,300, or annual income of $96,600, to follow the 28% rule. Similarly, your total debt could not exceed $660 to keep housing and debt costs from surpassing 36%.

Home mortgage loans, with the exception of certain government-backed loans, require a minimum credit score of 620 to qualify. However, a higher credit score can help secure more competitive rates. If you qualify as a first-time homebuyer, you could get a FHA loan with a credit score of 500 or higher, though borrowers with a credit score below 580 will have to make a 10% down payment.

As mentioned above, it’s a good idea to compare lenders and loan types to find the most favorable rate and loan terms. From there, getting preapproved for a home loan is a logical next step to determine the loan amount and interest rate you qualify for. It also puts you in a better position to demonstrate you’re a serious buyer when making an offer on a property.

After putting in an offer, completing the mortgage application requires many of the same forms used for preapproval, plus an earnest money deposit.


💡 Quick Tip: Generally, the lower your debt-to-income ratio, the better loan terms you’ll be offered. One way to improve your ratio is to increase your income (hello, side hustle!). Another way is to consolidate your debt and lower your monthly debt payments.

The Takeaway

Buying a home is the largest purchase many Americans make in their lifetime. How much you’ll end up paying for a $350,000 mortgage depends on the interest rate and loan term. On a $350,000 mortgage, the monthly payment can range from $2,328 to $3,146 based on these factors.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

How much is a $350K mortgage a month?

The cost of a $350,000 monthly mortgage payment is influenced by the loan term and interest rate. On a $350K mortgage with 7% interest, the monthly payment ranges from $2,328 to $3,146 depending on the loan term.

How much income is required for $350,000 mortgage?

Income requirements can vary by lender. But using the 28/36 rule, a borrower who isn’t burdened by lots of other debts should make $99,600 a year to afford the monthly payment on a $350,000 mortgage.

How much is a down payment on a $350,000 mortgage?

The down payment amount depends on the loan type and lender terms. FHA loans require down payments of 3.5% or 10%, while buyers could qualify for a conventional loan with as little as 3% down.

Can I afford a $350K house with a $70K salary?

It may be possible to afford a $350,000 house with a $70,000 salary, but only if you are able to make a sizable down payment to lessen the amount of money you need to borrow. Having a good credit score and minimal debt would also better your chances.

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Photo credit: iStock/sturti

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

^¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.

SOHL0124066

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Monthly payments on a $100,000 mortgage could range from $600 to around $1,000, depending on the loan’s interest rate, term, and other factors. But it’s also important to think about how much borrowing $100,000 will cost you over time, and to pay attention to all your costs as you move forward with your home purchase. Some costs may be negotiable, and a little comparison shopping could help you save. Read on for a breakdown of what the costs related to borrowing $100,000 might be.

What Will a $100,000 Mortgage Cost?

There are several different expenses you can expect to encounter when taking out a mortgage. Most of the time, they can be divided into three main categories.

Closing Costs

Closing costs, which you’ll pay upfront, typically include loan processing fees, third-party services such as appraisals and title insurance, and government fees and taxes. You also may choose to pay mortgage points (also known as discount points) on your loan to lower the interest rate. Closing costs can vary significantly, but they generally range from 3% to 6% of the loan amount.

Monthly Payments

Monthly mortgage payments, which are paid over the life of your loan, usually include two primary components:

•   Principal: This is the portion of your mortgage payment that goes directly toward paying back the amount you borrowed.

•   Interest: This is the amount the lender charges you for borrowing money. The amount of interest you pay each month will be calculated by multiplying your interest rate by your remaining loan balance.

Escrow

Some homebuyers may also have a third amount, called escrow, factored into their closing costs and/or monthly payments. Lenders often collect and hold money in an escrow account to ensure critical bills like homeowners insurance and property taxes are paid on time.


💡 Quick Tip: When house hunting, don’t forget to lock in your home mortgage loan rate so there are no surprises if your offer is accepted.

What Would the Monthly Payment Be for a $100,000 Mortgage

We’ll keep things simple and eliminate the costs associated with an escrow account to get an idea of what a $100,000 mortgage payment might look like each month.

Let’s say you wanted to purchase a home for $120,000, and you had $20,000 for a down payment. If your lender offered you a 7% annual percentage rate (APR) on a 15-year loan for $100,000, you could expect your monthly payment — principal and interest — to be about $898. If you had a 30-year loan with a 7% APR, a $100,000 mortgage payment could be about $665 per month.

Here are some more examples that show the difference between a 15-year loan vs. a 30-year loan, using a mortgage calculator:

APR	Payment with 15-year Loan	Payment with 30-year Loan
5.5%	$817	$817
6.5%	$871	$632
7.5%	$927	$699

How Much Interest Will You Pay on a $100,000 Mortgage?

The interest rate your lender offers can make a big difference in the overall cost of your mortgage. So can the mortgage term you choose. On a $100,000 mortgage at a 7% APR, for example, your total interest costs could range from $61,789 to $139,509, depending on the length of the loan you choose (15 vs. 30 years).

Stretching your mortgage payments over a longer term can lower your monthly payment, but you can expect to pay more for the loan overall. If you start out with a 30-year term and find your budget can handle larger payments, you can always consider a mortgage refinance or a recast to adjust your payment amount and schedule.

“Really look at your budget and work your way backwards,” explains Brian Walsh, CFP® at SoFi, on planning for a home mortgage.

Recommended: Best Affordable Places to Live in the U.S.

How Does Amortization Work on a $100,000 Mortgage?

Though your payment will remain the same every month (if you have a fixed-rate loan, you can expect the amount you’ll pay each month toward interest vs. principal to change over the life of your home loan. In the first years, the majority of your payment will go toward interest. But as your balance goes down, more of your payment will go toward principal.

Your lender should provide you with a repayment schedule, or mortgage amortization schedule, that shows you how the proportions will change over the length of your loan.

Here’s what the amortization schedules for a $100,000 mortgage with 30- and 15-year terms might look like. (Keep in mind that your payments may include other costs besides principal and interest.)

Amortization Schedule, 30-Year Loan at 7% APR

Year	Amount Paid	Interest Paid	Principal Paid	Remaining Balance
1	$7,983.63	$6,967.82	$1,015.81	$98,984.19
2	$7,983.63	$6,894.39	$1,089.24	$97,894.95
3	$7,983.63	$6,815.65	$1,167.98	$96,726.96
4	$7,983.63	$6,731.21	$1,252.42	$95,474.55
5	$7,983.63	$6,640.67	$1,342.96	$94,131.59
6	$7,983.63	$6,543.59	$1,440.04	$92,691.55
7	$7,983.63	$6,439.49	$1,544.14	$91,147.41
8	$7,983.63	$6,327.87	$1,655.76	$89,491.65
9	$7,983.63	$6,208.17	$1,775.46	$87,716.19
10	$7,983.63	$6,079.82	$1,903.81	$85,812.38
11	$7,983.63	$5,942.20	$2,041.43	$83,770.95
12	$7,983.63	$5,794.62	$2,189.01	$81,581.94
13	$7,983.63	$5,636.38	$2,347.25	$79,234.69
14	$7,983.63	$5,466.69	$2,516.94	$76,717.75
15	$7,983.63	$5,284.74	$2,698.89	$74,018.87
16	$7,983.63	$5,089.64	$2,893.99	$71,124.88
17	$7,983.63	$4,880.44	$3,103.19	$68,021.68
18	$7,983.63	$4,656.11	$3,327.52	$64,694.16
19	$7,983.63	$4,415.56	$3,568.07	$61,126.09
20	$7,983.63	$4,157.62	$3,826.01	$57,300.08
21	$7,983.63	$3,881.04	$4,102.59	$53,197.49
22	$7,983.63	$3,584.46	$4,399.17	$48,798.32
23	$7,983.63	$3,266.45	$4,717.18	$44,081.14
24	$7,983.63	$2,925.44	$5,058.19	$39,022.95
25	$7,983.63	$2,559.78	$5,423.85	$33,599.10
26	$7,983.63	$2,167.69	$5,815.94	$27,783.17
27	$7,983.63	$1,747.26	$6,236.37	$21,546.80
28	$7,983.63	$1,296.43	$6,687.20	$14,859.60
29	$7,983.63	$813.01	$7,170.62	$7,688.98
30	$7,983.63	$294.65	$7,688.98	$0

Amortization Schedule, 15-Year Loan at 7% APR

Year	Amount Paid	Interest Paid	Principal Paid	Remaining Balance
1	$10,785.94	$6,876.14	$3,909.80	$96,090.20
2	$10,785.94	$6,593.50	$4,192.44	$91,897.76
3	$10,785.94	$6,290.43	$4,495.51	$87,402.26
4	$10,785.94	$5,965.45	$4,820.49	$82,581.77
5	$10,785.94	$5,616.98	$5,168.96	$77,412.80
6	$10,785.94	$5,243.31	$5,542.63	$71,870.17
7	$10,785.94	$4,842.63	$5,943.31	$65,926.87
8	$10,785.94	$4,412.99	$6,372.95	$59,553.92
9	$10,785.94	$3,952.29	$6,833.65	$52,720.27
10	$10,785.94	$3,458.29	$7,327.65	$45,392.62
11	$10,785.94	$2,928.57	$7,857.37	$37,535.25
12	$10,785.94	$2,360.56	$8,425.38	$29,109.87
13	$10,785.94	$1,751.49	$9,034.45	$20,075.42
14	$10,785.94	$1,098.39	$9,687.55	$10,387.87
15	$10,785.94	$398.07	$10,387.87	$0

Where Can You Get a $100,000 Mortgage?

Homebuyers have options when they’re deciding where to go for a loan, including online banks and lenders, traditional banks, and credit unions. Because lenders’ rates and terms may vary, it can be a good idea to shop around for a mortgage that’s a good fit for your needs and goals.

Before you start getting mortgage estimates, you may want to sit down and figure out the different types of mortgages you’re interested in and what you might qualify for. Would you be better off with a conventional mortgage or a government-backed loan? Are you looking for a fixed or adjustable mortgage rate? Do you want a 15-, 20-, or 30-year mortgage? Some lenders specialize in certain kinds of loans, such as government-backed loans. And some loans may have less stringent standards for down payment amounts or a borrower’s credit score. Once you start comparison shopping, you may want to read some online reviews of the lenders you’re considering.


💡 Quick Tip: Generally, the lower your debt-to-income ratio, the better loan terms you’ll be offered. One way to improve your ratio is to increase your income (hello, side hustle!). Another way is to consolidate your debt and lower your monthly debt payments.

How to Get a $100,000 Mortgage

Feeling a little overwhelmed by the whole home-buying and mortgage process? Breaking it down into a few manageable steps may make things a little less daunting. If you’ve never bought a home before, spend some time studying up with a first-time homebuyer guide.

First, Figure Out What You Can Afford

Looking at your income, debts, monthly spending, and how much you’ve saved for a down payment can be a good place to start. This will help you determine how much of a down payment you can handle and how much house you can afford.

Look at Different Loans and Lenders

Once you know what you can afford, you can start looking for the loan type, interest rate, loan term, and lender that meet your needs.

Get Preapproved

Once you’ve decided on loan and lender, it can be a good idea to go through the preapproval process. Getting a letter from your lender that says you’re preapproved for a certain loan amount lets sellers know you’re a serious buyer (and can come in handy in a bidding war.)

Time to Go House Hunting

Once you’ve done your homework, you can search for and make an offer on a house. And since you already know how much you can afford, you can target homes in that range.

Submit a Full Mortgage Application

When you’re ready to seal the deal, be prepared to give your lender more financial information and documentation for a formal loan application.

Prepare for Closing

While you’re waiting for a final loan approval and a closing date, you can shop for homeowners insurance, get a home inspection, and make sure you have all the money you need for your down payment and closing costs.

Take Ownership of Your New Home

At the closing you can sign all the necessary paperwork, hand over the funds needed to make the purchase, and—congratulations!–get the keys to your new home.

How Much House Can You Afford Quiz

Recommended: 2024 Home Loan Help Center

The Takeaway

Researching the different expenses you might have to pay when taking out a $100,000 mortgage can help you stick to your budget and avoid unpleasant surprises. The choices you make about the type of loan you get, the interest rate, loan term, and other costs, will all affect how much you pay every month — and over the length of the loan.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

How much is a $100,000 mortgage a month?

The monthly payment for a $100,000 mortgage could range from $600 to around $1,000, depending on several factors, including the interest rate and loan term.

How much income is required for a $100,000 mortgage?

You’ll probably need to earn around $40,000 a year (before taxes) to get a $100,000 mortgage. But lenders will look at several factors, besides your income, to determine if you can afford a $100,000 mortgage. You can expect to be asked about your debt, credit history, assets, and the down payment you plan to make.

How much is a down payment on a $100,000 mortgage?

If you wanted to make a 20% down payment (thereby avoiding paying for mortgage insurance), you would put down around $25,000 on a $100,000 mortgage. But a down payment could be as low as 3% in some cases (around $4,000), and may vary depending on the price of the house you choose and the type of loan you get.

Can I afford a $100,000 mortgage with a $70,000 salary?

As long as all your monthly debt payments combined — including your house payment, credit cards, student loans, and car payments — are less than $2,100, you may be able to afford a $100,000 mortgage on a $70,000 salary.

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Photo credit: iStock/Hispanolistic

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOHL0124070

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A $300,000 mortgage payment could range from about $1,700 to more than $2,700 per month, depending on your loan’s interest rate, term, and other factors.When you’re shopping for a home, it’s easy to get fixated on how much you can borrow and finding houses in your price range. But understanding how much your mortgage could cost, upfront and over time, could be just as important to your success as a homebuyer. Read on for a look at what some of the expenses of getting a home mortgage might include.

How Much Can a $300,000 Mortgage Cost?

You can expect to run into a variety of costs when you take out a home loan. Most of the time these expenses can be broken down into three main categories:

Closing Costs

Closing costs are one-time costs that typically include loan processing fees, third-party services such as appraisals and title insurance, and government fees and taxes. You also may choose to pay discount points upfront on your loan to lower the interest rate. Closing costs can vary significantly, but they generally range from 3% to 6% of the loan amount.

Monthly Payments

The payments borrowers make monthly over the life of a mortgage usually include two main components:

•   Principal: This is the part of the mortgage payment that goes directly toward repaying the amount you borrowed.

•   Interest: This is the fee you pay the lender for borrowing money. The amount of interest you’ll pay each month will be calculated by multiplying your interest rate by your remaining loan balance.

Escrow

Your lender may collect and hold money in an escrow account to ensure that your homeowners insurance and property taxes are paid on time. The cost of living by state can vary widely and this is due in large part to taxes.

It’s important to pay attention to all your costs as you go through the homebuying process. You may be able to negotiate the amount of some of these expenses, which means doing some comparison shopping could help you save.


💡 Quick Tip: You deserve a more zen mortgage. Look for a mortgage lender who’s dedicated to closing your loan on time.

What Are the Monthly Payments for a $300,000 Mortgage?

To keep things simple, let’s eliminate any costs that might be associated with an escrow account to get a basic estimate of what a $300,000 mortgage payment might be each month.

Let’s say you wanted to buy a home for $340,000, and you had a down payment of $40,000. If your lender offered you a $300,000 loan with a 15-year fixed-rate term at a 7% annual percentage rate (APR), you could expect your monthly payment — principal and interest — to be about $2,696. If you took out a 30-year fixed-rate mortgage with a 7% APR, your payment could be about $1,995.

Here are some more examples that show what the difference can be for a 15-year fixed-rate loan vs. a 30-year fixed-rate loan, using SoFi’s Mortgage Calculator.

APR	Payment with 15-year Loan	Payment with 30-Year Loan
5.5%	$2,451	$1,703
6.5%	$2,613	$1,896
7.5%	$2,781	$2,097

Recommended: 2024 Home Loan Help Center

How Much Interest Will You Pay on a $300,000 Mortgage?

The interest rate your lender gives you can make a big difference in the overall cost of your mortgage, and so can the mortgage term you choose. With a $300,000 home loan at a 7% APR, for example, the total amount you pay in interest could range from $185,367 to $418,527, depending on the length of the loan (15 vs. 30 years).

Spreading out your mortgage payments over a longer term can lower your monthly payment. But keep in mind that if you make this choice, you can expect to pay more for the loan overall. You can get more specific information by plugging various scenarios into a home affordability calculator.


💡 Quick Tip: If you refinance your mortgage and shorten your loan term, you could save a substantial amount in interest over the lifetime of the loan.

How Does Amortization Work for a $300,000 Mortgage?

Though your payment will remain the same every month (if you have a fixed-rate home mortgage loan), you can expect the amount you pay toward interest vs. principal to change over the life of your loan. In the first years, most of your payment will go toward interest. But as your balance goes down, more of your payment will go toward principal.

Your lender can provide you with a repayment schedule, or mortgage amortization schedule, that illustrates how the proportions will change over the length of your loan. Here’s a look at what the amortization schedules for a $300,000 mortgage with 30- and 15-year terms might look like. (Remember that your payments could include other costs besides principal and interest.)

Amortization Schedule, 30-Year Loan at 7% APR

Year	Amount Paid	Interest Paid	Principal Paid	Remaining Balance
1	$23,950.89	$20,903.46	$3,047,43	$296,952.57
2	$23,950,89	$20,683.16	$3,267.73	$293,684.84
3	$23,950.89	$20,446.94	$3,503.95	$290,180.89
4	$23,950.89	$20,163.64	$3,757.25	$286,423.64
5	$23,950.89	$19,922.02	$4,028.87	$282,394.77
6	$23,950.89	$19,630.78	$4,320.11	$278,074.66
7	$23,950.89	$19,318.48	$4,632.41	$273,442.24
8	$23,950.89	$18,983.60	$4,967.29	$268,474.95
9	$23,950.89	$18,624.51	$5,326.38	$263.148.57
10	$23,950.89	$18,239.47	$5,711.42	$257,437.15
11	$23,950.89	$17,826.59	$6,124.30	$251,312.85
12	$23,950.89	$17,383.86	$6,567.03	$244,745.82
13	$23,950.89	$16,909.13	$7,041.76	$237,704.06
14	$23,950.89	$16,400.08	$7,550.81	$230,153.25
15	$23,950.89	$15,854.23	$8,096.66	$222,056.60
16	$23,950.89	$15,268.93	$8,681.96	$213,374,63
17	$23,950.89	$14,651.31	$9,309.58	$204,065.05
18	$23,950.89	$13,968.32	$9,982.57	$194,082.48
19	$23,950.89	$13,246.67	$10,704.22	$183,378.26
20	$23,950.89	$12,472.87	$11,478.02	$171,900.23
21	$23,950.89	$11,643.12	$12,307.77	$159,592.46
22	$23,950.89	$10,753.39	$13,197.50	$146,394.96
23	$23,950.89	$9,799.34	$14,151.55	$132,243.41
24	$23,950.89	$8,776.32	$15,174.57	$117,068.84
25	$23,950.89	$7,679.35	$16,271.54	$100,797.31
26	$23,950.89	$6,503.08	$17,447.81	$83,349.50
27	$23,950.89	$5,241.78	$18,709.11	$64,640.39
28	$23,950.89	$3,889.29	$20,061.59	$44,578.79
29	$23,950.89	$2,439.04	$21,511.85	$23,066.94
30	$23,950.89	$883.95	$23,066.94	$0

Amortization Schedule, 15-Year Loan at 7% APR

Year	Amount Paid	Interest Paid	Principal Paid	Remaining Balance
1	$32,357.82	$20,628.42	$11,729.39	$288,270.61
2	$32,357.82	$19,780.51	$12,577.31	$275,693.29
3	$32,357.82	$18,871.29	$13,486.53	$262,206.77
4	$32,357.82	$17,896.47	$14,461.47	$247,745.30
5	$32,357.82	$16,850.93	$15,506.89	$232,238.41
6	$32,357.82	$15,729.93	$16,627.88	$215,610.52
7	$32,357.82	$14,527.90	$17,829.92	$197,780.60
8	$32,357.82	$13,238.98	$19,118.84	$178,661.76
9	$32,357.82	$11,856.87	$20,500.94	$158,160.82
10	$32,357.82	$10,374.86	$21,982.96	$136,177.86
11	$32,357.82	$8,785.71	$23,572.11	$112,605.75
12	$32,357.82	$7,081.68	$25,276.14	$87,329.61
13	$32,357.82	$5,254.46	$27,103.35	$60,226.26
14	$32,357.82	$3,295.16	$29,062.66	$31,163.60
15	$32,357.82	$1,194.22	$31,163.60	$0

Where Can a Borrower Get a $300,000 Mortgage?

Homebuyers have a few different choices when deciding where to go for a loan, including online banks and lenders, and traditional banks and credit unions. Rates and terms can vary from one lender to the next, so it can be a good idea to shop around for a mortgage that fits your specific needs and goals.

Before you start looking for quotes, though, you may want to look at the different types of mortgage loans you might qualify for. Would you be better off with a conventional or government-backed mortgage? Are you eligible for a VA loan or first-time homebuyer assistance? How many years do you want to make payments on your loan, and would you prefer a fixed or adjustable rate?

Once you settle on some loans that might work for you, you may want to read online reviews of the lenders you’re considering. A good old-fashioned pros-and-cons list could also help you evaluate the possibilities.

Recommended: Tips to Qualify for a Mortgage

How to Get a $300,000 Mortgage

Whether you’re a first-time homebuyer or you’ve done this before, the home-buying and mortgage process can be a little daunting. By breaking it down into some manageable steps, you may be able to make things a little easier.

Start by Determining How Much You Can Afford

Looking at your income, debt, monthly spending, credit status, and how much you’ve saved for a down payment can be a good starting point when you’re trying to figure out how much house you can afford. This can help you decide how much of a down payment and monthly payment you can handle.

Research Different Loans and Lenders

Once you know what you can afford to spend, you can start looking for the loan type, interest rate, loan term, and lender that meet your needs. The mortgage professional you choose to work with should be able to walk you through your options and help you evaluate their pros and cons.

Get Preapproved

Once you’ve chosen a loan and lender, it can be a good idea to go through the mortgage preapproval process. Getting a letter from your lender that says you’re preapproved for a certain loan amount can let sellers know you’re a serious buyer. (This could be especially helpful if you find yourself in a bidding war.)

Go House Hunting

With your preapproval letter in hand, you can start your home search — and potentially make an offer on a house. And because you’re prepared and know how much you can afford, you and your real estate agent can target homes in an appropriate price range.

Submit a Full Mortgage Application

When you find a home and you’re ready to seal the deal, you can work with your lender to fill out a formal loan application. Be ready: Your lender will likely ask for more financial information and documentation before approving the loan.

Prepare for Closing

While you’re waiting for your final loan approval and a closing date from your lender, you can shop for homeowners insurance, get a home inspection, and make sure you have all the money you’ll need for your down payment and closing costs.

Take Ownership of Your New Home

At the closing, you’ll be asked to sign a lot of paperwork, and you’ll hand over the necessary funds to make the purchase. Finally — congratulations! — you’ll get the keys to your new home.

How Much House Can You Afford Quiz

The Takeaway

Researching the different costs you might have to pay when taking out a $300,000 mortgage could help you avoid any unpleasant surprises during the homebuying process and improve your chances of sticking to your budget. The decisions you make about the type of loan you get, the interest rate, loan term, and other costs will all impact how much you pay every month — and what you’ll pay for the loan overall. So it can be a good idea to run the numbers and evaluate your options before you decide on a particular loan.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

How much is a $300,000 mortgage payment per month?

The monthly payment for a $300,000 mortgage could range from about $1,700 a month to more than $2,700. Your payment will depend on several factors, including your interest rate and loan term.

How much income is required for a $300,000 mortgage?

An annual income in the $90,000-$100,000 range would qualify for a $300,000 mortgage as long as the borrower has few other debts. Mortgage lenders don’t make their decisions based on salary alone. You can expect your lender to look at several factors, including your debt, your credit rating and other factors before deciding how much you’re qualified to borrow.

How much is a down payment on a $300,000 mortgage

If you borrowed $300,000 and were putting down 20% on the property to avoid having to pay for mortgage insurance, your down payment would be around $75,000 (for a home priced at $375,000). But many borrowers put down less than 20%. A down payment of 3% on a home priced at $310,000 would cost you less than $10,000 and in this scenario you would also have a $300,000 mortgage.

Can I afford a $300,000 mortgage on a $70,000 salary?

If you can keep your monthly debt payments (housing costs and other debts combined) below $2,100 a month, you might be able to afford a $300,000 mortgage on a $70,000 salary, but it could be a stretch. How much mortgage you can afford usually depends on your monthly house payment and other debts you may have, such as car loans, credit cards, and student loans.

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Photo credit: iStock/irina88w

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

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The total cost of a mortgage depends on the loan term and the interest rate. For a $250,000 mortgage with a 30-year term and 7% interest rate, borrowers can expect a monthly mortgage payment around $1,663 a month.

However, there are other mortgage costs to consider — both at closing and over the life of the loan. Here’s a look at the factors that affect how much your mortgage costs, as well as what you can expect to pay for a $250,000 mortgage.

Cost of a $250,000 Mortgage

The cost of a $250,000 mortgage is more than just the borrowed amount, known as the loan principal. While borrowers repay the principal, they are also required to pay interest, calculated as a percentage of the loan amount, to cover the cost of issuing the loan. A percentage point difference in interest rate could bump up a $250,000 mortgage payment by $100 or more a month, significantly increasing the total interest paid over the life of the loan.

Most mortgages require a down payment, with the exception of VA loans and USDA loans. The minimum down payment depends on the type of loan and a borrower’s financial situation. For example, the required down payment on a FHA loan is 3.5% for borrowers with credit scores of at least 580 versus 10% for borrowers with credit scores between 500-579.

The down payment amount also impacts the total cost of home mortgage loans. Homeowners will be on the hook for paying private mortgage insurance (PMI) with their monthly payments unless they put 20% or more down. PMI is usually 0.5% to 1.5% of the loan principal per year, spread across monthly mortgage payments.

Buying a house also involves closing costs, typically ranging from 3% to 6% of the loan principal. For a $250,000 mortgage, closing costs would likely be between $7,500 and $15,000. If saving up for both the down payment and closing proves to be a challenge, buyers may have the option to roll closing costs into a home loan to spread out the cost over time.

Recommended: Best Affordable Places to Live in the U.S.

Monthly Payments for a $250,000 Mortgage

Figuring out how much you can afford to spend on housing each month is an essential step to determining your homebuying budget. Monthly mortgage payments typically include four components: loan principal, interest, taxes, and insurance.

Assuming a 30-year fixed term and an interest rate of 7%, a $250,000 mortgage monthly payment would amount to $1,663 for the loan principal and interest. Choosing a 15-year loan term with a 7% interest rate would translate to a monthly mortgage payment of $2,247. Note that these figures do not include property taxes and insurance. Taxes vary according to your property’s assessed value, as well as by location — so the cost of living by state is another factor buyers must consider.

Initially, the majority of the monthly mortgage payment goes toward interest rather than paying off the loan principal. Over time, a greater share of the mortgage payment is applied to the principal balance, helping build equity in your home.

For a more detailed look at what a $250,000 mortgage payment amounts to, using a mortgage calculator or home affordability calculator lets you experiment with different down payments, interest rates, and loan terms.

💡 Quick Tip: If you refinance your mortgage and shorten your loan term, you could save a substantial amount in interest over the lifetime of the loan.

Where to Get a $250,000 Mortgage

The majority of U.S. homebuyers use a mortgage loan to finance their home purchase. Buyers can get a $250,000 mortgage from a variety of lenders, including banks, credit unions, mortgage brokers, and online lenders. Shopping around and looking at multiple lenders is recommended to help secure a lower interest rate and save thousands over the life of a mortgage. Besides the interest rate, examine the differences in fees, mortgage points, and expected closing costs when comparing lenders.

There are also different types of mortgage loans to consider. Your mortgage loan options depend in part on your location, Veteran status, down payment size, and whether you qualify as a first-time homebuyer. For comparison, here’s the mortgage amortization schedule on a 30-year mortgage vs a 15-year loan. In both cases we are assuming a $250,000 mortgage with a 7% fixed rate. Looking at a $250,000 mortgage payment 30 years’ out, borrowers would pay $194,284 more in interest payments than with a 15-year term.

Amortization schedule, 30-year mortgage at 7%

Beginning Balance	Monthly Payment	Total Interest Paid	Total Principal Paid	Remaining Balance
$250,000	$1,663.26	$17,420	$2,540	$247,460
$247,460	$1,663.26	$17,236	$2,723	$244,737
$244,737	$1,663.26	$17,038	$2,920	$241,817
$241,817	$1,663.26	$16,828	$3,131	$238,686
$238,686	$1,663.26	$16,602	$3,357	$235,329
$235,329	$1,663.26	$16,359	$3,600	$231,729
$231,729	$1,663.26	$16,099	$3,860	$227,869
$227,869	$1,663.26	$15,820	$4,139	$223,729
$223,729	$1,663.26	$15,520	$4,439	$219,290
$219,290	$1,663.26	$15,200	$4,760	$214,531
$214,531	$1,663.26	$14,855	$5,104	$209,427
$209,427	$1,663.26	$14,487	$5,473	$203,955
$203,955	$1,663.26	$14,091	$5,868	$198,087
$198,087	$1,663.26	$13,667	$6,292	$191,794
$191,794	$1,663.26	$13,212	$6,747	$185,047
$185,047	$1,663.26	$12,724	$7,235	$177,812
$177,812	$1,663.26	$12,201	$7,758	$170,054
$170,054	$1,663.26	$11,640	$8,319	$161,735
$161,735	$1,663.26	$11,039	$8,920	$152,815
$152,815	$1,663.26	$10,394	$9,565	$143,250
$143,250	$1,663.26	$9,703	$10,256	$132,994
$132,994	$1,663.26	$8,961	$10,998	$121,996
$121,996	$1,663.26	$8,166	$11,793	$110,203
$110,203	$1,663.26	$7,314	$12,645	$97,557
$97,557	$1,663.26	$6,399	$13,560	$83,998
$83,998	$1,663.26	$5,419	$14,540	$69,458
$69,458	$1,663.26	$4,368	$15,591	$53,867
$53,867	$1,663.26	$3,241	$16,748	$37,149
$37,149	$1,663.26	$2,033	$17,927	$19,222
$19,222	$1,663.26	$737	$19,222	$0

Amortization schedule, 15-year mortgage at 7%

Beginning Balance	Monthly Payment	Total Interest Paid	Total Principal Paid	Remaining Balance
$250,000	$2,247.07	$17,190	$9,774	$240,226
$240,226	$2,247.07	$16,484	$10,481	$229,744
$229,744	$2,247.07	$15,726	$11,239	$218,506
$218,506	$2,247.07	$14,914	$12,051	$206,454
$206,454	$2,247.07	$14,042	$12,922	$193,532
$193,532	$2,247.07	$13,108	$13,857	$179,675
$179,675	$2,247.07	$12,107	$14,858	$164,817
$164,817	$2,247.07	$11,032	$15,932	$148,885
$148,885	$2,247.07	$9,881	$17,084	$131,801
$131,801	$2,247.07	$8,646	$18,319	$113,482
$113,482	$2,247.07	$7,321	$19,643	$93,838
$93,838	$2,247.07	$5,901	$21,063	$72,775
$72,775	$2,247.07	$4,379	$22,586	$50,189
$50,189	$2,247.07	$2,746	$24,219	$25,970
$25,970	$2,247.07	$995	$25,970	$0

Recommended: Home Loan Help Center

How to Get a $250,000 Mortgage

If the estimated monthly payments above fit your budget, proceed with the following steps to get a $250,000 mortgage. First, take stock of your financial situation and read up on tips to qualify for a mortgage before applying. Start by checking your credit score, calculating your debt-to-income (DTI) ratio, and evaluating your available savings for a down payment and closing costs. Lenders consider all these factors when reviewing a loan application. Ahead of time, prepare the documents you’ll need for the mortgage application, including bank statements, tax returns, and W-2s.

After comparing lenders and loan types, getting preapproved for a home loan is a logical next step. Mortgage preapproval from a lender shows the loan amount and interest rate you qualify for, helping inform your budget and demonstrate that you’re a serious buyer when putting in an offer on a property.

💡 Quick Tip: Generally, the lower your debt-to-income ratio, the better loan terms you’ll be offered. One way to improve your ratio is to increase your income (hello, side hustle!). Another way is to consolidate your debt and lower your monthly debt payments.

The Takeaway

The cost of taking out a $250,000 mortgage depends on the interest rate and loan term. A monthly $250,000 mortgage payment also includes taxes and insurance. To get a $250,000 mortgage, borrowers need to factor a down payment and closing costs into their homebuying budget.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

How much is a $250K mortgage a month?

The payment on a $250,000 mortgage with a 7% interest rate would be $1,663 a month for a 30-year term and $2,247 a month for a 15-year term. The down payment amount, property taxes, and insurance costs also impact the monthly mortgage payment.

How much income is required for $250,000 mortgage?

The required income for a $250,000 mortgage depends on several factors, including existing debt, down payment size, and interest rate. With a 20% down payment and 7% interest rate, an income of $77,710 or more would qualify for a $250K mortgage, provided you don’t have a lot of debt already.

How much is a down payment on a $250,000 mortgage?

The required down payment on $250,000 mortgages depends on the loan type and lender. FHA loans require down payments of 3.5% or 10%, while buyers could qualify for a conventional loan with as little as 3% down.

Can I afford a $250K house with a $70K salary?

You may be able to afford a $250,000 house with a $70,000 salary. Besides income, how much house you can afford depends on how much you are prepared to pay for a down payment and what your debt-to-income ratio is.

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Photo credit: iStock/Antonio_Diaz

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

^¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
^†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.

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You’re ready to make home improvements. When looking for a trustworthy pro, it’s a good idea to get referrals, check references, get multiple bids, and nail down your financing. Let’s drill down to the details on how to find a good contractor for remodeling and what you need to ask as you move through the process.
​​

💡 Quick Tip: With SoFi, it takes just minutes to view your rate for a home loan online.

Ask for Referrals

Often the easiest way to find a reputable contractor for your project is through word-of-mouth referrals, whether from a friend, neighbor, family member, or colleague. Maybe you’ve watched your friend remodel the kitchen on social media; you may want to ask for the name of the contractor behind the job. Likewise, if you see a big construction project going up in your neighborhood, you can ask the homeowner for insight on the contractor behind it.

You might also want to ask owners of local lumber yards, where con­tractors do their bulk business, who’s reliable.

Recommended: Refinance Your Mortgage and Save

Search Online for the Top-Reviewed Contractors

Before hiring a contractor to renovate or remodel your home, it’s smart to do your due diligence and collect as many references as possible. But if you’re new to a town or neighborhood, for example, you may wonder how to find a contractor who works in your area.

This is where online reviews come in handy. There are many websites out there that offer lists of licensed contractors with accompanying reviews.

Look at Credentials and Portfolio

As you begin speaking with each potential contractor, ask to see a copy of their contractor’s license and insurance policy, and ask about any specialty certifications or membership to any professional organizations like the National Association of Home Builders, the National Association of the Remodeling Industry, or the National Kitchen & Bath Association.

Be aware that some states require contractor licensing; others, certification or registration. Registration doesn’t guarantee expertise; it’s merely a written record of who is performing the work. Many but not all states have websites where you can verify your pro’s license number. If your property is governed by a homeowners association or condo association, remember that the association may require proof of licensing.

Most reputable builders or contractors should have a website or basic social media presence, but if you can’t find one, request an email link to the contractor’s portfolio to see examples of past projects, from countertop replacement to closet remodels, as well as before and after photos.

Interview Candidates

Once you have a list of potential contractors narrowed down to your three top picks, it’s a good move to interview each of them before you go a step further. Maybe you won’t jibe with one of them, or perhaps another won’t seem as knowledgeable about certain components of construction or remodeling as you’d like for your particular project.

Treat hiring any contractor or handyman just like you would hiring an employee for your work, and if you don’t get a good feeling about the candidate, trust your gut. Communication is key for any successful project, and if the communication feels lacking in the interview process, it’s likely you’ll get frustrated down the line when all the moving parts of a remodeling project are also thrown into the mix.

Check References

After you’ve compiled a list of contractors and interviewed your top candidates, you’ll want to check references. Professionals should be able to provide a list of contacts from past jobs, and if they can’t do so right on the spot, that’s probably a red flag.

When checking references, you might want to ask past customers if the contractor completed the job on time and within budget, if there were any problematic interactions, and how the work has held up since.

Review the Cost Estimate

You could find the perfect contractor for the job, only to learn that the pro is far out of your budget.

It’s smart to get at least three competitive quotes from contractors before you move forward. A cost estimate should include labor, materials, change-order language, and a timeline, at minimum. Many contractors also have payment schedules so you will know when you’ll need to have your finances in order.

One positive if you have second thoughts about the expense: While the cost to remodel a house may not be cheap, if you keep your property modern and up to date, it’s possible you’ll recoup those dollars in resale value down the line.


💡 Quick Tip: Compared to credit cards and other unsecured loans, you can usually get a lower interest rate with a cash-out refinance loan.

Consider the Red Flags

If it’s your first time hiring a contractor, you may not know what to look for — or what’s a red flag. To save yourself headaches down the road, if the contractor checks any of the below boxes, the person’s professionalism might be in question and it’s probably wise to move on to the next candidate.

•   No “before” remodeling pictures

•   No website, social media presence, or reviews

•   No license or certification

•   No references

•   Slow communication

Recommended: The Cost of Living By State

The Takeaway

How to find a contractor for home renovations? Hiring a contractor is a process that you’d be smart to treat like a job interview. It’s a good idea to check references and credentials, get bids, look for red flags, and have financing lined up, whether you take out a personal loan or opt for a home equity line of credit (HELOC).

SoFi now offers flexible HELOCs. Our HELOC options allow you to access up to 95% of your home’s value, or $500,000, at competitively low rates. And the application process is quick and convenient.

Unlock your home’s value with a home equity line of credit brokered by SoFi.

FAQ

Before you sign on the dotted line for your remodeling job, there are some things about working with a contractor you need to know before locking one in.

What should a remodel contract include?

You’ll want to make sure the contract lays out the overall project budget and scope of work, when payments are due, and how to handle the inevitable changes that will arise.You’ll also want to have a dispute resolution and waiver of the lien clause so that a subcontractor cannot put a lien on your home, and a warranty for the work that is an acceptable time frame for the amount you’ve invested.

What questions should I ask a contractor?

When you’re meeting with each potential contractor, ask about past projects and if they have specific experience doing the type of renovation work that you’d like done. It’s also helpful to ask how they would approach the project and how much of an impact it’ll have on your ability to live in the home while work is taking place.

You’ll also want to inquire about insurance. Ask for proof that the contractor carries an insurance policy that protects you, the homeowner, as well. All of these are things a professional contractor should have and easily be able to produce.

What should you know before hiring a contractor?

Know that there are always bad actors who can take advantage of the huge sums of money that Americans pouring into real estate investment — and that no reputable contractor should be offended if you ask for references, proof of insurance, and all promises in writing.

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Photo credit: iStock/BOX39studio

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