$600,000 Mortgage: What You Should Expect To Pay

The cost of a $600,000 mortgage payment not only depends on the interest rate you receive and the term you choose, but also property taxes and home insurance. If you take out a $600,000 home loan with a 30-year repayment term, your monthly principal and interest could range from $3,597 to $4,195, based on your interest rate.

This guide will inform you about the factors you need to consider when purchasing a home, as well as the possible monthly costs you can expect with a $600,000 mortgage. 

Monthly payments for a $600,000 mortgage

The monthly payment for a $600,000 mortgage includes principal and interest, as well as other essential items.

Here’s an overview of a typical mortgage payment: 

• Loan principal: The amount your lender loans to you after your down payment. After closing, the loan principal is the remaining amount you have left to pay.
• Interest rate: The fee your lender charges you in exchange for loaning you money. 
• Property taxes: The taxes you’ll pay to your local government for your home, which are based on your property’s assessed value. As a homeowner, part of your monthly mortgage payment will go into an escrow account to cover what you owe.
• Homeowners insurance: This protects you if damage occurs to your property. Home insurance also typically includes liability protection if someone gets hurt on your property. As with property taxes, you make a partial payment each month toward your annual premium. That money is set aside by your lender into an escrow account and is paid to the provider on your behalf.

The table below illustrates what the monthly principal and interest payment would be for a $600,000 mortgage, depending on which interest rate you receive.

Where to get a $600,000 mortgage

Many traditional banks, credit unions, and online lenders provide loans for $600,000 or more, but the trick is finding the one with the best offer for you. 

Once you’ve found the best lender, it’s time to officially submit a loan application. To do this, you may need to provide additional documentation to your lender.

What to consider before applying for a $600,000 mortgage

In addition to your monthly mortgage payment, you should also plan to pay for a down payment, closing costs, upkeep costs, and, if applicable, homeowner association dues. 

The amount needed for a down payment on a $600,000 house depends on the type of mortgage you choose and what your lender approves you for. Some lenders might require you to pay for mortgage insurance if you make a down payment that’s less than 20%. 

Also consider ongoing upkeep costs when determining how much house you can afford. A good rule of thumb is to set aside a minimum of 1% of your home’s value. For a home assessed at $600,000, this means you should set aside at least $6,000 a year for future upkeep expenses, such as a new roof or kitchen appliances. 

Saving up for a house can take time, so make sure you consider every variable.

Amortization table on a $600,000 mortgage

The amortization schedule largely depends on the loan term you choose. Here’s a breakdown of a $600,000 loan repayment schedule with a 30-year term and a 6% fixed rate. 

Here’s the amortization schedule for a $600,000 loan with a 6% fixed interest rate and a 15-year term instead of a 30-year term:

How to get a $600,000 mortgage

When you apply for a mortgage, be prepared to provide significant documentation, including your homebuying budget, income, savings and assets, and credit history.

Here are the steps you’ll take to get a $600,000 home loan:

1. Determine what you can afford: Many lenders prefer that mortgages account for no more than 28% of a borrower’s gross monthly income. However, you’ll need to account for all of your other monthly debts, including credit cards, student loans, or car payments. Keep a lender’s maximum loan amount in mind, but also determine what you are comfortable spending each month.
2. Check your credit: Your credit score may influence what loans you’re eligible for, so check your credit report. If you find any errors, dispute them as soon as possible.
3. Get pre-approved: A pre-approval letter shows you the interest rate, loan amount, and potential terms you’re likely to qualify for. Request pre-approval early so you have a better idea of your budget and can make an offer when you find the right house.
4. Compare offers: After you’re pre-approved by a few lenders, compare your offer letters and find the best deal for you. Look at interest rates, terms, and mortgage point costs.
5. Look for a home: Browse homebuying sites, find a real estate agent, and start looking for the right home. Once you’ve found the one you want, make an offer and negotiate with the seller. 
6. Complete the mortgage application: After your offer is accepted, you will need to complete a mortgage application with your lender. You may need to submit additional financial documents. Submit these as soon as possible so you don’t delay closing.
7. Wait for approval: Once your documents have been submitted, your application moves to underwriting. During this time, your lender verifies your financial documents and information to determine whether to extend the loan.
8. Prepare for closing: You’ll then typically be scheduled for a closing date. Before then, you’ll need to arrange homeowners insurance and review your closing disclosures.
9. Close: At closing, you’ll pay closing costs, make your down payment, and sign transfer documents. Once you do, you’re officially a homeowner.