Texas Mortgage Calculator

How to Calculate a Mortgage Payment in Texas (with Taxes & Insurance)

Texas is unique among high-cost states: it levies no state income tax, so local governments fund schools, roads, and services almost entirely through property taxes. The result is an average effective property tax rate of roughly 1.6%–2.2% — among the highest in the nation — even though home prices in much of the state remain moderate. When you calculate a mortgage payment in Texas, property tax is the single largest non-principal line item in your monthly escrow, and it varies sharply by county, school district, and special-purpose districts.

A full Texas mortgage payment with taxes and insurance (PITI) combines four components: monthly principal and interest (from the amortization formula), monthly property tax (the annual county bill ÷ 12), monthly homeowners insurance, and — if you put less than 20% down — private mortgage insurance (PMI). The calculator above locks in the 1.70% Texas average property tax and shows the complete PITI breakdown so you can see exactly how much of each payment goes to tax versus principal and interest.

Texas also charges no mortgage recording tax and no state-level transfer tax, which keeps closing costs lower than in New York or Florida — but the high ongoing property tax more than offsets that over time. For a $350,000 Texas home at the 1.70% average rate, property tax alone adds about $496 per month to your payment, on top of principal, interest, and insurance.

Texas Property Tax, County Appraisal District (CAD) Protests & Homestead Exemptions

Texas property is appraised by your local County Appraisal District (CAD), which sets the taxable market value each year. Because values can rise sharply in fast-growing metros like Austin, Dallas–Fort Worth, and Houston, your escrow payment can jump year to year even when your loan payment stays fixed. Texas homeowners have the right to protest their appraisal annually with the CAD — typically by May 15 — and a successful protest lowers your appraised value, reducing both your annual tax bill and your monthly escrow.

Texas offers a generous homestead exemption for primary residences: a general exemption (typically $25,000 for school-district taxes, with many counties and cities adding more) plus additional exemptions for seniors (age 65+), disabled homeowners, and veterans. Claiming the homestead exemption reduces your taxable value and your monthly escrow, and it also caps annual assessed-value increases on a homesteaded property — a meaningful long-term protection. File Form 50-114 with your CAD once you occupy the home.

If your down payment is below 20%, PMI applies and adds to your monthly cost. Texas buyers should also budget for windstorm and hail coverage in coastal and plains regions, and for flood insurance in FEMA-designated zones — these are separate from a standard homeowners policy and can be required by lenders. Adjust the insurance field in the calculator to reflect your actual quote for an accurate total monthly payment.

All figures are estimates for informational and planning purposes only and do not constitute financial, tax, or mortgage advice. Confirm final rates, taxes, and insurance with your lender, county assessor, and a licensed insurance agent.