Which combination of information is needed to estimate a fixed-rate mortgage payment?

• A. Loan amount, annual interest rate, and loan term.
• B. Down payment and insurance rate.
• C. Employment status and income.
• D. Property taxes and insurance.

Answer: (A)

The amount you pay each month on a fixed-rate mortgage (the principal and interest portion) is determined by three things: how much you borrow (the loan amount or principal), the annual interest rate, and how long the loan lasts (the term). With a fixed rate, the payment stays the same over the term, and the rate and term together dictate how much of each payment goes toward interest versus principal. Down payment affects how large the loan is but isn’t itself a payment component once you know the loan amount. Insurance and property taxes aren’t part of the fixed principal-and-interest payment; they may be added to create a total monthly housing cost (often called PITI), but they don’t set the fixed payment schedule. Employment status and income influence whether you qualify or what you can afford, not the actual monthly payment calculation.