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If you’re thinking about the possibility of purchasing a home in the North Star State, figuring out if you can handle the mortgage payments ahead — and exactly how you’ll pay them each month — is a big prep step. A Minnesota mortgage calculator can provide you with clarity on what your monthly expenses might look like. It can also assist you in making informed decisions about your down payment, loan term, and more. This article will fill you in on how to use a mortgage calculator and help you get the most out of this tool as you look for your dream home in Minnesota.
Key Points
• Using a mortgage calculator involves inputting the home’s purchase price, your down payment, and the interest rate and loan term.
• The home’s Minnesota property tax rate will impact the monthly payment amount.
• A loan’s term may be 10 to 30 years, and will be a determiner of monthly and overall costs.
• First-time homebuyer programs can help aspiring buyers afford a down payment or cover closing costs.
• A mortgage calculator can help you determine what home price, down payment, and interest rate best suit your financial situation, so you can find a home you can afford.
Minnesota Mortgage Calculator
Calculator Definitions
• Home price: The home price is the purchase price you’ve agreed on with the property’s seller. This figure may differ from the listing price and the initial offer you made.
• Down payment: The down payment is the amount the homebuyer pays upfront, and is often expressed as a percentage of the home price. Most buyers put down between 3% and 20%. A down payment calculator can show how different percentages translate into dollar amounts.
• Loan term: Most homebuyers pay off their mortgages over a 15-year or 30-year term, though 10- and 20-year terms may also be available. A longer term means lower payments but more interest to pay over the life of the home loan. A shorter term means higher monthly payments but faster equity — and less interest in the end.
• Interest rate: The interest rate is the cost of borrowing the money to buy a home, and is expressed as a percentage of the loan amount. Interest rates vary based on borrower qualifications, market trends, and the type of mortgage loan sought.
• Annual property tax: Property tax is levied by local governments on land and buildings. It’s expressed as a percentage of a home’s assessed value. Minnesota’s annual property tax rate is currently 0.98%.
• Monthly payment: The monthly payment that the Minnesota calculator crunches includes loan principal and interest, as well as property taxes. Keep in mind that you may need to pay for private mortgage insurance (PMI), homeowners insurance, and homeowners association (HOA) fees in addition.
• Total interest paid: The total interest paid amounts to how much interest you’ll pay over the life of your home loan. This figure can be substantial — and grows with your loan’s term. The Minnesota mortgage calculator shows you how different down payment amounts, interest rates, and loan terms affect the interest you will pay on the money you borrow.
• Total loan cost: The total loan cost is the all-in amount you’ll repay, including principal and interest. This figure gives you a clear understanding of the long-term financial commitment buying a home entails.
How to Use the Minnesota Mortgage Calculator
Step 1: Enter Your Home Price
Type in the final negotiated amount you’ve agreed to pay the seller for the property. This lets the calculator create an accurate estimate of your monthly mortgage payments.
Step 2: Select a Down Payment Amount
Choose the percentage of the home price you plan to pay upfront. A larger down payment will make your monthly mortgage payments more manageable and potentially eliminate a need for PMI, which is usually required if you put down less than 20% of the home price.
Step 3: Choose a Loan Term
Select the amount of time over which you’ll repay your mortgage, typically 15 or 30 years. The longer the term, the lower the monthly payments but the higher the total interest paid.
Step 4: Enter an Interest Rate
Input your desired interest rate to the second or third decimal point. This rate significantly impacts both your monthly mortgage payment and the total cost of the loan.
Step 5: Add Your Property Tax
Enter the percentage of your home’s value that you’ll be required to pay each year as property tax. If your property tax rate is 0.78%, for instance, you’ll enter 0.78. Count on it impacting your total monthly mortgage payment.
A mortgage calculator helps homebuyers estimate the affordability of different loan scenarios. You can calculate monthly payments and long-term costs based on the loan amount, interest rate, and term. The calculator also factors in funds to pay property taxes, which are often held in escrow by the mortgage company. The taxes are then paid to the appropriate agencies. (It’s in the lender’s interest for your property to stay out of tax arrears.)
If you’re buying your first home and the world of mortgage rates is new to you, you can easily get up to speed on how they work by using this calculator. It’s particularly proficient at demonstrating how different interest rates or down payment amounts can impact short- and long-term costs
Deciding How Much House You Can Afford
The median home sale price in mid-2025 in Minnesota was around $368,600, according to Redfin. Lenders recommend keeping your home loan payment at 28% or less of your gross monthly income. To buy a $350,000 home with a 20% down payment ($70,000) and a 30-year mortgage at 7.00%, you’d need a minimum income of nearly $100,000. Your monthly mortgage payment would be just under $2,300. You’d have to earn more to compensate if your down payment was smaller, or if you were carrying other debt.
Another way to get a handle on your Minnesota housing budget is to work backward from your gross monthly income using a home affordability calculator, which can take into consideration other debts you may be working on settling, like a car payment or a student loan balance.
You could test-run the mortgage preapproval process with a lender, too. Just provide detailed financial information to one or more institutions to see if the lenders will preapprove you. If you qualify, they will offer you a loan amount and interest rate.
Components of a Mortgage Payment
A mortgage payment mainly covers two things: an installment on the principal (aka the home price or borrowed amount) and accruing interest (the borrowing cost). Your monthly payment might also include other line items, like your property tax, which is based on your home’s value. If your down payment is less than 20%, the lender will likely require private mortgage insurance (PMI). Other costs potentially rolled into the payment include homeowners association (HOA) fees and homeowners insurance.
Homebuyers who are considering making a purchase with the help of a Federal Housing Administration (FHA) loan will have an upfront and ongoing mortgage insurance premium (MIP) to pay. Regardless, these loans are affordable and popular among first-time buyers. If you are looking at an FHA loan, use an FHA mortgage calculator to create a budget. Similarly, if you plan to purchase your home with a loan backed by the U.S. Department of Veterans Affairs, you’ll want to run your numbers through a VA mortgage calculator.
Compare current home interest rates by state and find a mortgage rate that suits your financial goals.
Select a state to view current rates:
Cost of Living in Minnesota
The cost of living in your area affects how much you can afford when you buy a home. According to Missouri Economic Research and Cost of Living data, Minnesota was close to the middle in the U.S. in late 2025 with an index of 94.6%. The state’s residents encounter slightly higher-than-average grocery and health-related costs.
Here’s a look at how some major Minnesota cities compare to the national average for living expenses. In the chart, 100 equals the average cost of living in the U.S.
Minnesota Cities’ Cost-of-Living Stats
Mankato
95.1
Minneapolis
93.6
St. Cloud
97.6
St. Paul
94.0
Other Minnesota towns that appear on a list of the best affordable places in the U.S. include Maple Grove, Eagan, Duluth, Red Wing, and Winona. Homes in some of Minnesota’s higher-cost cities and towns might require a jumbo loan as a mortgage option.
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Any payments shown depend on the accuracy of the information provided.
Tips on Reducing Your Mortgage Payment
Minnesota homebuyers have strategies and opportunities to lower their mortgage payment. Here are some possible ways to reduce the amount you have to pay on your home loan monthly:
• Drop PMI when you reach 20% home equity. (You’ll need to inform your lender.)
• Recast your mortgage by making a lump-sum payment toward the principal, and then asking your lender to recalculate your monthly payment.
• Think about appealing your property tax — but only follow through if you can be very sure that they are too high. A reassessment can also result in a tax increase, which may well increase your monthly payment. Tread carefully here.
• If you find yourself facing financial hardship, request a possible loan modification from your lender.
• Extend your loan term from, say, 20 years to 30. This move can lower your monthly payments.
• Shop around for a less-costly homeowners insurance policy.
• Consider a mortgage refinance if mortgage rates have dropped since you bought your home. Don’t forget to factor in the closing costs on this move.
If you qualify as a first-time homebuyer in Minnesota, you can possibly tap into state programs that aid aspiring owners with down payments or closing costs. A state agency called Minnesota Housing makes homeownership accessible to people with limited savings and earnings, providing below-market-interest-rate loans and down payment help for eligible low- and middle-income buyers. To top it off, you could get extra perks when you qualify as a new homebuyer — meaning you haven’t owned a primary residence in the last three years.
Getting to know what the Minnesota mortgage calculator can do for you is a great first step if you’re set on buying a home of your own. It can help you understand the financial commitment it takes to be successful after being granted a home loan. The calculator can help you make informed decisions about how much house you can afford and whether you’re prepared to make your purchase. Whether you’re a first-time homebuyer or a seasoned property owner, it can provide valuable insights.
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.
How does my credit score affect my mortgage loan interest rate?
Your credit score has a serious impact on your mortgage interest rate, since lenders routinely offer their most attractive interest rates to borrowers with higher scores. The lower the interest rate, the more overall affordable the total cost of the mortgage will be. A lower score could result in a higher interest rate and stricter conditions, and could stand in the way of your approval.
How much should I put down on a mortgage?
You should make as large a down payment as you comfortably can on your home. Take care, however, not to pinch your finances and leave yourself without a cushion. Don’t empty your emergency fund or stop paying on other debts. Do take advantage of low down payments for first-time buyers, since they can in some cases put down as little as 3%. Repeat buyers may be able to contribute just 5%. In most cases, if you put down less than 20% you’ll have PMI added to your monthly bill. Always look at the entire financial picture to determine what makes sense for your financial scenario.
Should I choose a 15-year or 30-year term for my mortgage?
A 15-year term will have you making a higher monthly payment, but it could save you thousands of dollars in interest. A 30-year term gives you lower monthly payments, making homeownership quite a bit more accessible. Can your budget accommodate a term of 15 or even 20 years? Then shorter is a smart way to go. But you can also feel just fine locking in 30 years, especially if this is your very first home purchase. It’s the choice in most first mortgages in the U.S.
How can I get a lower mortgage interest rate?
To get the best rate, focus on your credit score and make it ultra-competitive (700 or higher, which is way over the 620 you need to simply qualify). Prequalify online with multiple lenders, and vie for the best rate they offer. Save up so you can make a higher down payment.
Can I afford a $300K house on a $70K salary?
It would not be easy to do. Paying off a $300,000 property when you are bringing home $70,000 annually is going to be a strain, unless you can find the cash to make a hefty down payment. Advisors say the price of your home shouldn’t exceed your salary times three — which in this example would be $210,000. Use a home affordability calculator to crunch some numbers and see how much down payment you’d need to make a $300,000 home doable. Then make a realistic call before making an offer.
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*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.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
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.
