PgMP reality - PgMP Updated: 2023
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Exam Code: PgMP PgMP reality November 2023 by Killexams.com team|
I. Strategic Program Management (11 tasks) 15%
II. Program Life Cycle (35 tasks) 44%
- Initiating (6 tasks) 6%
- Planning (9 tasks) 11%
- Executing (9 tasks) 14%
- Controlling (6 tasks) 10%
- Closing (5 tasks) 3%
III. Benefits Management (8 tasks) 11%
IV. Stakeholder Management (7 tasks) 16%
V. Governance (11 tasks) 14%
Perform an initial program assessment by defining the program objectives, requirements, and risks in order to ensure program
alignment with the organizations strategic plan, objectives, priorities, vision, and mission statement.
Establish a high-level road map with milestones and preliminary estimates in order to obtain initial validation and approval from the executive sponsor.
Define the high-level road map/framework in order to set a baseline for program definition, planning, and execution.
Task 4 Define the program mission statement by evaluating the stakeholders concerns and expectations in order to establish program direction.
Evaluate the organizations capability by consulting with organizational leaders in order to develop, validate, and assess the
program objectives, priority, feasibility, readiness, and alignment to the organizations strategic plan.
Identify organizational benefits for the potential program using research methods such as market analysis and high-level cost-benefit analysis in order to develop the preliminary program scope and define benefits realization plan.
Estimate the high level financial and nonfinancial benefits of the program in order to obtain/maintain funding authorization and drive prioritization of projects within the program.
Evaluate program objectives relative to regulatory and legal constraints, social impacts, sustainability, cultural considerations, political climate, and ethical concerns in order to ensure stakeholder alignment and program deliverability.
Obtain organizational leadership approval for the program by presenting the program charter with its high-level costs, milestone
schedule and benefits in order to receive authorization to initiate the program.
Identify and evaluate integration opportunities and needs (for example, human capital and human resource requirements and skill sets, facilities, finance, assets, processes, and systems) within program activities and operational activities in order to align and integrate benefits within or across the organization.
Knowledge specific to Domain 1
(*Indicates knowledge is found in one other domain, shown in parentheses)
Business/organization objectives* (V)
Financial measurement and management techniques
Intellectual property laws and guidelines
Legal and regulatory requirements
Program and constituent project charter development* (II)
Program mission and vision
Public relations* (IV)
Requirement analysis techniques
Strategic planning and analysis* (II)
System implementation models and methodologies
Task 1 Develop program charter using input from all stakeholders, including
sponsors, in order to initiate and design program and benefits.
Task 2 Translate strategic objectives into high-level program scope
statements by negotiating with stakeholders, including sponsors, in
order to create a program scope description.
Task 3 Develop a high-level milestone plan using the goals and objectives of
the program, applicable historical information, and other available
resources (for example, work breakdown structure (WBS), scope
statements, benefits realization plan) in order to align the program with
the expectations of stakeholders, including sponsors.
Task 4 Develop an accountability matrix by identifying and assigning program
roles and responsibilities in order to build the core team and to
differentiate between the program and project resources.
Task 5 Define standard measurement criteria for success for all constituent
projects by analyzing stakeholder expectations and requirements
across the constituent projects in order to monitor and control the
Task 6 Conduct program kick-off with key stakeholders by holding meetings
in order to familiarize the organization with the program and obtain
Task 7 Develop a detailed program scope statement by incorporating program
vision and all internal and external objectives, goals, influences, and
variables in order to facilitate overall planning.
Task 8 Develop program WBS in order to determine, plan, and assign the
program tasks and deliverables.
Task 9 Establish the program management plan and schedule by integrating
plans for constituent projects and creating plans for supporting
program functions (for example, quality, risk, communication,
resources) in order to effectively forecast, monitor, and identify
variances during program execution.
Task 10 Optimize the program management plan by identifying, reviewing, and
leveling resource requirements (for example, human resources,
materials, equipment, facilities, finance) in order to gain efficiencies
and maximize productivity/synergies among constituent projects.
Task 11 Define project management information system (PMIS) by selecting
tools and processes to share knowledge, intellectual property, and
documentation across constituent projects in order to maximize
synergies and savings in accordance with the governance model.
Task 12 Identify and manage unresolved project-level issues by establishing a
monitoring and escalation mechanism and selecting a course of action
consistent with program constraints and objectives in order to achieve
Task 13 Develop the transition/integration/closure plan by defining exit criteria
in order to ensure all administrative, commercial, and contractual
obligations are met upon program completion.
Task 14 Develop key performance indicators (KPIs) by using decomposition/
mapping/ balanced score card (BSC) in order to implement scope and
quality management system within program.
Task 15 Monitor key human resources for program and project roles, including
subcontractors, and identify opportunities to Excellerate team motivation
(for example, develop compensation, incentive, and career alignment
plans) and negotiate contracts in order to meet and/or exceed benefits
Task 16 Charter and initiate constituent projects by assigning project
managers and allocating appropriate resources in order to achieve
Task 17 Establish consistency by deploying uniform standards, resources,
infrastructure, tools, and processes in order to enable informed
program decision making.
Task 18 Establish a communication feedback process in order to capture
lessons learned and the teams experiences throughout the program.
Task 19 Lead human resource functions by training, coaching, mentoring, and
recognizing the team in order to Excellerate team engagement and
achieve commitment to the programs goals.
Task 20 Review project managers performance in executing the project in
accordance with the project plan in order to maximize their
contribution to achieving program goals.
Task 21 Execute the appropriate program management plans (for example,
quality, risk, communication, resourcing) using the tools identified in
the planning phase and by auditing the results in order to ensure the
program outcomes meet stakeholder expectations and standards.
Task 22 Consolidate project and program data using predefined program plan
reporting tools and methods in order to monitor and control the
program performance and communicate to stakeholders.
Task 23 Evaluate the programs status in order to monitor and control the
program while maintaining current program information.
Task 24 Approve closure of constituent projects upon completion of defined
deliverables in order to ensure scope is compliant with the functional
Task 25 Analyze variances and trends in costs, schedule, quality, and risks by
comparing real and forecast to planned values in order to identify
corrective actions or opportunities.
Task 26 Update program plans by incorporating corrective actions to ensure
program resources are employed effectively in order to meet program
Task 27 Manage program level issues (for example, human resource
management, financial, technology, scheduling) by identifying and
selecting a course of action consistent with program scope,
constraints, and objectives in order to achieve program benefits.
Task 28 Manage changes in accordance with the change management plan in
order to control scope, quality, schedule, cost, contracts, risks, and
Task 29 Conduct impact assessments for program changes and recommend
decisions in order to obtain approval in accordance with the
Task 30 Manage risk in accordance with the risk management plan in order to
ensure benefits realization.
Task 31 Complete a program performance analysis report by comparing final
values to planned values for scope, quality, cost, schedule, and
resource data in order to determine program performance.
Task 32 Obtain stakeholder approval for program closure in order to initiate
Task 33 Execute the transition and/or close-out of all program and constituent
project plans (for example, perform administrative and PMIS program
closure, archive program documents and lessons learned, and transfer
ongoing activities to functional organization) in order to meet program
objectives and/or ongoing operational sustainability.
Task 34 Conduct the post-review meeting by presenting the program
performance report in order to obtain feedback and capture lessons
Task 35 Report lessons learned and best practices observed and archive to the
knowledge repository in order to support future programs and
Knowledge Specific to Domain 2
(*Indicates knowledge is found in one other domain, shown in parentheses)
Closeout plans, procedures, techniques and policies* (5)
Decomposition techniques (for example, work breakdown structure (WBS))
Financial closure processes* (V)
Performance and quality metrics* (III)
Phase gate reviews* (V)
Product/service development phases
Program and constituent project charter development* (I)
Program and project change requests* (V)
Program initiation plan
Program management plans
Quality control and management tools and techniques
Resource estimation (human and material)
Resource leveling techniques
Root cause analysis
Schedule management, techniques, and tools
Service level agreements
Statistical analysis* (V)
Strategic planning and analysis* (I)
Team competency assessment techniques
Training methodologies* (IV)
Task 1 Develop the benefits realization plan and its measurement criteria in
order to set the baseline for the program and communicate to
stakeholders, including sponsors.
Task 2 Identify and capture synergies and efficiencies identified throughout
the program life cycle in order to update and communicate the
benefits realization plan to stakeholders, including sponsors.
Task 3 Develop a sustainment plan that identifies the processes, measures,
metrics, and tools necessary for management of benefits beyond the
completion of the program in order to ensure the continued realization
of intended benefits.
Task 4 Monitor the metrics (for example, by forecasting, analyzing variances,
developing “what if” scenarios and simulations, and utilizing causal
analysis) in order to take corrective actions in the program and
maintain and/or potentially Excellerate benefits realization.
Task 5 Verify that the close, transition, and integration of constituent projects
and the program meet or exceed the benefit realization criteria in order
to achieve programs strategic objectives.
Task 6 Maintain a benefit register and record program progress in order to
report the benefit to stakeholders via the communications plan.
Task 7 Analyze and update the benefits realization and sustainment plans for
uncertainty, risk identification, risk mitigation, and risk opportunity in
order to determine if corrective actions are necessary and
communicate to stakeholders.
Task 8 Develop a transition plan to operations in order to guarantee
sustainment of products and benefits delivered by the program.
Knowledge Specific to Domain III
(*Indicates knowledge is found in one other domain, shown in parentheses)
Business value measurement
Decision tree analysis
Maintenance and sustainment of program benefits post delivery
Performance and quality metrics* (II)
Program transition strategies
Task 1 Identify stakeholders, including sponsors, and create the stakeholder
matrix in order to document their position relative to the program.
Task 2 Perform stakeholder analysis through historical analysis, personal
experience, interviews, knowledge base, review of formal agreements
(for example, request for proposal (RFP), request for information (RFI),
contracts), and input from other sources in order to create the
stakeholder management plan.
Task 3 Negotiate the support of stakeholders, including sponsors, for the
program while setting clear expectations and acceptance criteria (for
example, KPIs) for the program benefits in order to achieve and
maintain their alignment to the program objectives.
Task 4 Generate and maintain visibility for the program and confirm
stakeholder support in order to achieve the programs strategic
Task 5 Define and maintain communications adapted to different
stakeholders, including sponsors, in order to ensure their support for
Task 6 Evaluate risks identified by stakeholders, including sponsors, and
incorporate them in the program risk management plan, as necessary.
Task 7 Develop and foster relationships with stakeholders, including
sponsors, in order to Excellerate communication and enhance their
support for the program.
Knowledge Specific to Domain IV
(*Indicates knowledge is found in one other domain, shown in parentheses)
Customer relationship management
Customer satisfaction measurement
Public relations* (I)
Training methodologies* (II)
Task 1 Develop program and project management standards and structure
(governance, tools, finance, and reporting) using industry best
practices and organizational standards in order to drive efficiency and
consistency among projects and deliver program objectives.
Task 2 Select a governance model structure including policies, procedures,
and standards that conforms program practices with the
organizations governance structure in order to deliver program
objectives consistent with organizational governance requirements.
Task 3 Obtain authorization(s) and approval(s) through stage gate reviews by
presenting the program status to governance authorities in order to
proceed to the next phase of the program.
Task 4 Evaluate key performance indicators (for example, risks, financials,
compliance, quality, safety, stakeholder satisfaction) in order to
monitor benefits throughout the program life cycle.
Task 5 Develop and/or utilize the program management information system),
and integrate different processes as needed, in order to manage
program information and communicate status to stakeholders.
Task 6 Regularly evaluate new and existing risks that impact strategic
objectives in order to present an updated risk management plan to the
governance board for approval.
Task 7 Establish escalation policies and procedures in order to ensure risks
are handled at the appropriate level.
Task 8 Develop and/or contribute to an information repository containing
program-related lessons learned, processes, and documentation
contributions in order to support organizational best practices.
Task 9 Identify and apply lessons learned in order to support and influence
existing and future program or organizational improvement.
Task 10 Monitor the business environment, program functionality
requirements, and benefits realization in order to ensure the program
remains aligned with strategic objectives.
Task 11 Develop and support the program integration management plan in
order to ensure operational alignment with program strategic
Knowledge Specific to Domain V
(*Indicates knowledge is found in one other domain, shown in parentheses)
Archiving tools and techniques
Business/organization objectives* (I)
Closeout plans, procedures, techniques and policies* (II)
Composition and responsibilities of the program management office (PMO)
Financial closure processes* (II)
Go/no-go decision criteria
Governance processes and procedures
Metrics definition and measurement techniques
Performance analysis and reporting techniques (for example, earned value analysis (EVA))
Phase gate reviews* (II)
Program and project change requests* (II)
Statistical analysis* (II)
Benefits measurement and analysis techniques
Budget processes and procedures
Business models, structure, and organization
Coaching and mentoring techniques
Collaboration tools and techniques
Communication tools and techniques
Conflict resolution techniques
Data analysis/data mining
Human resource management
Impact assessment techniques
Industry and market knowledge
Leadership theories and techniques
Negotiation strategies and techniques
Organization strategic plan and vision
Performance management techniques (for example, cost and time, performance against objectives)
Planning theory, techniques, and procedures
PMI Code of Ethics and Professional Conduct
Presentation tools and techniques
Problem-solving tools and techniques
Project Management Information Systems (PMIS)
Reporting tools and techniques
Risk analysis techniques
Risk mitigation and opportunities strategies
Safety standards and procedures
Sustainability and environmental issues
Team development and dynamics Active listening
Customer centricity/client focus
Distilling and synthesizing requirements
Interpersonal interaction and relationship management
Managing virtual/multicultural/remote/global teams
Maximizing resources/achieving synergies
Stakeholder analysis and management
PMI PgMP reality
Other PMI examsPgMP PgMP
PMBOK-5th Project Management 5th Edition
PMI-001 Project Management Professional - PMP (PMBOK 6th Edition)
CAPM Certified Associate in Project Management (CAPM) - 2023
PMI-100 Certified Associate in Project
PMI-200 PMI-Agile Certified Practitioner (PMI-ACP)
PMI-ACP PMI Agile Certified Practitioner
PMI-RMP PMI Risk Management Professional
PMI-SP PMI Scheduling Professional
PMP Project Management Professional - PMP (PMBOK 6th Edition)
PMP-Bundle PMI-001 PMBOK v5(Video Training, Study Guides, QA) Complete Certification Pack
PMI-002 Certified Associate in Project Management (CAPM)
PPM-001 Professional in Project Management(PPM)
CCE-CCC Certified Cost Consultant / Cost Engineer (AACE International)
PMI-PBA PMI Professional in Business Analysis
PfMP Portfolio Management Professional (PfMP)
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Kelly's program is slipping on its schedule. Management is panic that the program
will be late and this will cost the organization several thousand dollars in fines and
penalties. They've asked Kelly to use a schedule duration compression technique that
will help the program finish on time. The technique that Kelly can use, however,
should not add costs to the program. What duration compression technique should
Kelly use in this instance?
A. Crash the program
B. Add lead time to the program
C. Trim the program scope
D. Fast track the program
Which of the following is described in the statement given below?
"It serves as the primary input for the Plan Program Stakeholder Management process,
as well as for the distribution of program reports and other communication."
A. Governance plan
B. Organizational chart
C. Program scope statement
D. Stakeholder register
A project manager in your program has estimated the cost of a program to be
$145,000. As the project manager's project comes close to completion, the project
manager realizes that he has still $27,876 left in his project budget. He decides to add
some additional features to the project's deliverables in an effort to use the remaining
budget. These additions will add value to the project and the project customer is likely
to enjoy these new features. This is an example of what term?
A. Gold plating
B. Value added change
C. Expert judgment by the project manager
D. Errors and omissions
A program has a BAC of $1,750,000 and is expected to last two years. The program is
currently at the third milestone which represents 35 percent of the program work. As it
happens, this program has already spent $620,000 of the budget. Management is
concerned that the program may also be slipping on schedule because the program
should be forty percent complete by this time. Based on this information which type of
performing is present in this scenario?
A. Cost, because the program has an estimate to complete of $1,151,429.
B. Cost, because the program has a cost variance of -7,500
C. Schedule, because theprogram's planned value is only $700,000.
D. Schedule, because the program has a schedule performance index of .88.
You are the program manager for your organization. Management has asked you to
create a document that will capture the stakeholders concerns, perceived threats, and
specific objectives about the program and its projects. What document is management
asking you to create in this instance?
A. Business case
B. Scope statement
C. Requirements document
D. Project charter
You are the program manager of the NHQ Program. You are working with your
program team to ensure that the work in the program is done accurately and according
to scope. You are also reviewing the team inspection process that will need to be done
to ensure that the work is being done according to the scope. If the work is found to be
defective it will need to be corrected before the program customers can inspect the
work. What process are you completing to ensure that the work is done accordingly to
B. Scope verification
C. Quality control
D. Quality assurance
A new program is being initiated for the HNQ Organization. The program manager is
working with the business analyst and management to define several attributes of the
program. All of the following are identified during program initiation except for which
A. Program benefits
B. Link to organizational strategy
C. Program scope
D. Program risk
You are the program manager for your organization and are reviewing several
proposed change requests for your program. Mary, a stakeholder, who has made a
change request is asking why it is taking you so long to review the change. You tell her
that you must perform integrated change control to review each change request. What
is integrated change control?
A. It is the review of the impact of the change on the program's triple constraints.
B. It is the review of the impact of the change on the time, cost, scope, and quality
C. It is the review of the impact of the change on the program's Iron Triangle.
D. It is the review of the impact of the change on the program's knowledge areas.
You are the program manager for your organization. This program will last for two
years and has eight projects. The cost of your program is $4 million and there are some
risk concerns that may affect the overall cost of the program. Management is
concerned with how long it will take the program to reach the management horizon.
What is management horizon also known as?
A. Payback period
B. Cost-to-benefits ratio
C. Cost performance index
D. Return on investment
Mary Anne is the program manager for her organization. In her program there are six
projects. One of the projects in her program has been performing well. It is on schedule
and has no cost or schedule variances. Mary Anne has decided, however, that her
program needs to be terminated. Which one of the following is a likely reason why the
project should be terminated?
A. The program scope has changed.
B. The project scope has changed from the original intent of the project
C. The scope is not being met as planned due to scope creep.
D. The project resources are not completing their project tasks as assigned.
An organization is considering a new program. The business analyst believes that the
benefits to the organization would equate to $1,550,000 in five years. If the rate of
return for this program is six percent what is the maximum amount the organization
should invest in this program?
B. It depends on the internal decision making process.
Julie is the program manager of the NHQ Program for her organization and she
believes the program is now complete. Julie is closing her program, and she's working
with her program sponsor to review the program's deliverables and benefits. Janet, the
program sponsor, is very pleased with the program and agrees that the program has
met the program scope. What should Julie and the program sponsor do next?
A. Sign the certificate of program closure
B. Complete the program's budget
C. Release the program's resources
D. Close the constituent projects before closing the program
You are the program manager for your organization and management has asked you to
be certain to finalize the lessons learned documentation for your program. When will
the lessons learned documentation be created?
A. Lessons learned are created at each program deliverable.
B. Lessons learned are created during the program closure.
C. Lessons learned are created during the program archive.
D. Lessons learned are in program execution.
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A new toxic trend, PMI, is set to take over the world of dating next year. Here’s how to spot it and stop it in its tracks before it ruins your next fling.
The early days of a new fling are filled with almost every emotional peak and trough in the book. From the longwinded anticipation of each text to the silent panic that sets in when you realize you’re sitting across the table from a cat person (instant dealbreaker), the dating scene can be one whirlwind of an emotional rollercoaster.
While there are plenty of valid reasons why a fresh romance won’t survive the harsh dating landscape, self-sabotage (whether intentional or not) has got to be one of the most unfortunate. Now, there’s a new trendy iteration of dating drama casting a shadow on new couples everywhere. Premature intimacy, or PMI, speaks to the urge to share too much too soon with a new partner, often leaving people feeling exposed or regretful.
Certified sex and relationship practitioner, Georgia Grace, shares with Body+Soul why healthy boundaries and a strong line of communication are so important to nurture at the start of any relationship, and why it’s crucial to look out for signs of PMI.
What exactly is PMI?
While yet another trending abbreviation might have you cursing the ever-changing Gen Z language, this one is especially important. A quick scan of the English language will tell you the word ‘premature’ is scarcely used to describe anything good, with its current dating association only reinforcing the stereotype.
PMI is the romance equivalent of TMI (too much information), incorporating whispers of love bombing and trauma dumping. In essence, the term refers to the oversharing of mind, body and soul. Imagine you’re sitting across from your date at dinner, swapping facts about yourselves and critiquing the restaurant’s playlist. Suddenly, before you’ve even had time to digest the entrees, your casual first date begins talking about your detailed future plans or reaches over to plant a kiss on your lips. Pretty jarring image right?
While intimacy is no doubt an important building block for any blossoming relationship, overstepping too early on is a surefire way to supply someone the ‘ick’. PMI can manifest in more ways than simply oversharing your thoughts on a date, such as overt displays of physical affection and deep dives into your personal information.
“[PMI] is a really hard thing to measure,” says Grace, noting every relationship travels on its own unique timeline. “Yes, it’s exciting when you start a new relationship, but it’s also important to have platonic love and friendships, to see your family and to make sure you’re going to work and moving your body in the way that you like to move it so that you still have a sense of self and it doesn’t get wrapped up or lost in this new relationship energy.”
According to relationship expert Jessica Alderson, unleashing intimacy too early on in the relationship has become increasingly more common in the modern dating landscape. PMI can be caused by a myriad of reasons, such as a deep-rooted need for validation or an inability to accurately understand social cues.
“Some people have a fear of rejection or abandonment and believe that by opening up quickly they can create a strong bond,” she shares with Stylist. “They may believe that by being vulnerable and sharing personal information in the early stages of dating, their date will see them as more desirable or trustworthy.”
What are the consequences of PMI?
Now, maintaining the right level of intimacy can be a challenge for any couple, regardless of whether you’re celebrating two weeks or 20 years of blissful harmony. Intimacy ebbs and flows throughout different stages of any relationship, but it’s important to establish healthy boundaries and expectations early on.
‘Being all in’ has no doubt been romanticized across pop culture, leaving many fresh couples feeling the pressure to imitate every smiling couple on social media, apparent products of ‘love at first sight’.
“They’re selling the dream, they’re selling romance,” Grace says of couples across the media landscape. “We cannot and should not turn to TV or social media to teach us about relationships, because often they are designed to reflect a relationship that is entertaining, that is exciting, that makes us feel. But they’re often not real.”
Exposing your new partnership to intense bursts of intimacy before it’s ready will only create cracks in the relationship, often causing irreversible damage.
There are some immediate consequences for PMI, with the most common ones being the risk of overwhelming your partner or having them misinterpret your behavior. Too much PMI early on may also lay the foundation for other issues down the track.
One of the best parts of any new relationship is gradually learning about each other’s lives, slowly uncovering the interesting facets of your partner’s personality, “A gradual unfolding of personal details can contribute to the anticipation and enjoyment of discovering more about each other over time”, says Alderson. Too much intimacy in the early days fast-tracks this process, removing the sense of intrigue that fuels attraction.
“Oversharing early on can leave little room for growth and discovery as a couple. This can hinder the development of a strong, lasting bond,” adds Alderson.
“No two relationships are the same,” explains Grace, adding that any stage of a partnership can see couples misaligned in their expectations and goals. “I would never put a time frame on anything because it’s such an individual thing.”
In a new relationship, intimacy is important for growth and connection, just ensure you’re employing self-awareness and sharing something with the right intention in mind.
“I would never suggest or recommend not opening up on a first date, but you can have a choice around how much you share and what you share,” says Grace. “And you can also set a boundary if someone is trauma dumping on you because that’s not fun and it’s not sexy and it’s kind of overwhelming.”
How to use this mortgage calculator
The Ascent's mortgage affordability calculator with PMI, interest, and property taxes helps you understand how much a home loan will cost. It also makes it easy to compare loan options. To use the calculator, plug in:
You can also add the cost of home insurance, property taxes, and homeowners association (HOA) fees, if you know them. This can supply you a more accurate estimate and help you with your home search.
Mortgage calculator formulas
A good mortgage payment calculator takes into account all the monthly costs that go into a mortgage payment. These costs are added together to estimate your total monthly payments as well as the interest you'll pay over time.
Here's how a mortgage rate calculator determines your payment amount.
1. A mortgage affordability calculator can estimate how much you're borrowing
This is the total home price, minus any down payment. Enter the price of the home you're interested in, as well as how much you're using as a down payment, into the mortgage loan calculator. If you are buying a $400,000 home and making a $40,000 down payment, the calculator subtracts $40,000 from $400,000 to determine that you are borrowing $360,000.
2. A mortgage loan calculator can take your principal and interest payments into account
A mortgage payment can be broken down into four parts: Principal, interest, taxes, and insurance.
A mortgage loan calculator calculator can estimate your principal and interest for each month, based on a specific interest rate. A loan with a longer term typically has a higher interest rate, but the principal payment isn't as high each month as with the payment for a shorter-term loan, since you have longer to pay off the principal.
For example, if you borrowed $360,000 on a 30-year loan at 7.5%, your principal and interest payment would be $2,517. If you borrowed the same amount through a 15-year loan at 6.8%, your principal and interest payment would be $3,196.
3. A mortgage repayment calculator can account for property taxes, home insurance, HOA fees, and any mortgage insurance costs
If you're taking out a mortgage, the monthly payment consists of more than just principal and interest. You're also responsible for paying property taxes and homeowners insurance, both of which are added into your monthly payment. Some homeowners also pay a homeowners association (HOA) fee.
A mortgage affordability calculator can estimate these inputs based on the typical costs for a home in your price range, or you can provide exact details to get a more accurate estimate. For example, if your home insurance is $1,200 per year, your property taxes are $3,000 annually, and your HOA fees are $500 per year, this adds around $392 to your monthly payment.
If you've made less than a 20% down payment, private mortgage insurance (PMI) must also be included, which typically costs between 0.5% and 1.0% of your loan amount annually. For instance, if you're borrowing $360,000, you might pay between $1,800 and $3,600 for mortgage insurance.
Principal, interest, property taxes, HOA costs, home insurance fees, and PMI are added together, resulting in your total monthly payment. If you opted for the 30-year loan mentioned above, this would mean adding up:
The calculator would show your total monthly mortgage payment at $3,384.
Elements of a house loan calculator
It's important to understand all the inputs of a home loan repayment calculator to determine your monthly and total costs.
This is the amount you are paying for the home. If you've made an offer to buy a house for $400,000, the home price would be $400,000.
The down payment is the amount of money you put down on the property at closing. Ideally, this will be at least 20% of the home's purchase price because you can qualify for a more affordable loan and get a broader choice of lenders. Lenders do let you put down much less in some cases -- as low as 3%, or even $0 with certain loans (such as VA loans).
Your down payment is determined by the amount of cash you have available to put toward the home. If you have $40,000 available for this use, you'd be putting 10% down on your $400,000 loan.
The down payment is subtracted from the home's purchase price to determine the amount of money you borrow from your mortgage lender.
Interest is the rate you pay to borrow. Your interest rate is based on national averages and economic conditions, as well as individual financial credentials such as your credit score and your debt relative to your income. Your mortgage loan type and choice of lender also factor into your interest rate.
The higher the interest rate, the more financing charges you pay your lender over time. A higher rate also leads to larger monthly payments.
Often, in addition to your interest rate, you'll see something called "annual percentage rate," or mortgage APR. A mortgage APR is the yearly cost of borrowing money. It includes your interest rate, but also fees your lender may charge, all rolled into one rate.
A mortgage rate calculator can help you understand how different interest rates impact a mortgage's monthly payments. It can be helpful to shop around for mortgage rates before using a mortgage rate calculator to get a sense of the rates you may see in the market when applying for a loan.
Private mortgage insurance (PMI)
Mortgage lenders require you to have private mortgage insurance (PMI) when your down payment is less than 20% of your home's value. The amount you pay depends on how much you borrow, but its annual premium is typically between 0.5% and 1.0% of your home loan.
There are several kinds of mortgages, including 30-year, 20-year, and 15-year loans. Your loan type affects monthly payments and total costs.
A loan with a longer payoff time typically has a higher interest rate. Since you pay more in financing charges and pay interest for longer, it's more expensive than a loan with a shorter payoff period. However, the monthly payments are lower than a shorter-term loan. Because you aren't making as many payments, loans with shorter payoff times have higher monthly payments -- despite the lower rate and lower total costs.
Homeowners insurance is required by lenders. Lenders require this because the home serves as collateral for the loan. The cost to insure a property is based on many factors, including its value, the type of insurance, and the level of risk. For example, homes in an area prone to earthquakes typically cost more to insure. The same is true of homes in areas prone to mudslides or on floodplains.
It's a good idea to compare insurance quotes from several carriers to find the most affordable coverage. Rates can vary dramatically, particularly after you factor in the variety of discounts offered by insurers.
Lenders typically collect monthly payments (as part of your overall mortgage payment) for home insurance and keep the money in an escrow account. For example, if your insurance is $1,200 per year, your insurer adds $100 onto your mortgage payment. The money is kept in a special account, then your insurance bill is sent to your lender, which pays it out of that account annually.
Property tax is paid to local and state governments. The amount of property tax depends where you live. It's usually expressed as a percentage of your home's value. Property tax payments are also collected by your lender as part of your monthly mortgage payments and put into escrow until your lender pays your property tax bill once per year.
If your home is part of a homeowners association, then HOA fees are factored into monthly housing costs as well. HOAs collect dues to maintain common areas and provide other services.
While paying funds into escrow raises the total due each month, it removes the headache of trying to come up with the money to pay insurance, taxes, and HOA fees when those bills come due.
Who should use a mortgage calculator?
A mortgage calculator can be helpful for people in a variety of situations. Whether you're just starting to explore the idea of home ownership, saving for a down payment, or working toward closing on the house of your dreams, a mortgage calculator can help you get an idea of what to expect financially.
Why would someone need a mortgage calculator with PMI, interest, and taxes?
Our simple mortgage calculator can help you make informed decisions about your loan, including:
If you get quotes from several mortgage or refinance lenders, you can also use our mortgage affordability calculator above to view the true cost of each loan.
How to interpret the results of the mortgage repayment calculator
The results of a mortgage repayment calculator can help you determine how much a particular loan will cost each month. Using the calculator, you can compare loan types and determine, for instance, if you prefer a 15-year or 30-year loan, based on total costs and monthly payments.
You can also make sure the mortgage payments fit into your budget. If your total payment would be $3,384 with all costs added in, you can assess whether this is a comfortable amount to pay.
Generally, a mortgage payment should never exceed 28% of your monthly take-home pay. Let's say you bring home $6,000 per month -- 28% of $6,000 is $1,680. That means that your mortgage payments, including principal, interest, taxes, insurance, and HOA should not be more than $1,680.
What to do after using the mortgage calculator
After using the mortgage loan calculator, you're ready to make informed choices about home buying. Consider taking these next steps.
Get qualified for a loan
Once you've used the mortgage repayment calculator to get an idea of the financial dynamics of a mortgage, it's time to think about qualifying for the loan itself.
Work on improving your financial credentials to increase the odds you can qualify for a mortgage loan at a competitive rate. This could mean paying down debt or improving your credit score.
Choose a loan type
A home loan repayment calculator can help you compare the repayment size with the time it will take you to repay a loan.
You can use a simple mortgage interest calculator to decide if you want a 30-, 20-, or 15-year loan based on the monthly payments and total loan costs for each loan type.
Compare rate quotes
Apply with several lenders to get preliminary rate quotes. You can input the interest rates and terms each lender offers into the home loan repayment calculator to help you compare lenders.
After narrowing your options to one lender, submit your financial information to complete the pre-approval process. Lenders will assess your details and tell you how much you can borrow, at what rate. You'll lock in your loan rate during this process.
While you aren't 100% guaranteed to get the loan you're pre-approved for, you should get final approval under the agreed-upon terms as long as nothing changes financially, and the home you're buying is approved by the lender.
Complete your purchase
After getting pre-approved, you can make an offer on a home. When that offer is accepted, you'll go through the appraisal and inspection process. Once the home checks out and your lender reviews your financial credentials again, you close on your home loan.
Frequently asked questions about mortgages
How do I qualify for a mortgage?
To qualify for a mortgage or refinance, shop around with several lenders. When you find the best rates and terms, make sure you meet the lender's requirements for income, debt, and credit score.
You'll then provide information on your finances, so gather documents such as pay stubs and bank statements. Once you've found the right loan and have your paperwork ready, submit an application. For more information, or if you're ready to go, use our form to guide you through the process and get a mortgage pre-approval.
Can I get a mortgage with no credit?
Yes, although it won't be as simple as landing a loan with a strong credit history. Most lenders look at your credit report and score when determining if you qualify for a home loan. However, some lenders work with borrowers who don't have a credit history. They can review other documentation, such as utility statements, showing you have a history of making on-time payments.
Shop around for a lender that does manual underwriting and prepare financial documentation such as bank statements. Find out more in this guide to how to buy a house with no credit.
What does a mortgage payment include?
Your monthly mortgage payment includes:
A simple mortgage calculator with taxes and PMI can tally these up and supply you a hypothetical mortgage payment. You could also use a mortgage amortization calculator or amortization schedule to supply you a sense of how much interest you'll pay over time. Amortization calculators and amortization schedules help individuals measure the financial impact of all types of loans -- and since a mortgage is a loan, those tools could help you understand your mortgage better.
What mortgage type should I choose?
The type of mortgage you should choose depends on many factors, including your credit history, your down payment amount, the type of house you're buying, and your goals for your loan. For example, you may wish to choose a:
These are just a few examples of different home loans. Research all the mortgage types before you decide. For example, if you're purchasing a fixer-upper and want to borrow enough money to cover both the home and the cost of upgrades and repairs, look into a conventional, FHA, or USDA rehab loan.
What can I expect in the home-buying process?
To begin the process of buying a home, set a budget to ensure you're prepared to qualify for a home loan and pay a mortgage. Prepare the financial documents that mortgage lenders will want to review. Get quotes from several lenders, and pursue mortgage pre-approval from the one offering the best terms.
You may want to hire a real estate agent to help you shop for properties. When you find a home that fits your budget and criteria, make an offer, including any contingencies or conditions that must be met, such as a satisfactory inspection. Complete the formal loan approval process for the mortgage loan that best fits your needs, and close on your transaction.
This home buyer checklist provides more insight into each of these steps, so check it out before you shop for a property.
How much should you save for a down payment?
Ideally, you will make a down payment equal to 20% of the value of the property. So if you're buying a $400,000 home, save $80,000.
However, many people don't save this much for a down payment. You could qualify for a conventional loan (not backed by the government) with as little as 3% down. Some government-backed loans don't require a down payment at all. But if you don't make a down payment or make a small one, expect to pay mortgage insurance or other upfront fees.
Whether you plan to save 20% or not, look into how to save for a down payment.
What documents do you need to apply for a mortgage?
To apply for a mortgage, you need:
Lenders may also request additional information, so read more details in our full guide to what documents are required for home loans.
What expenses of homeownership do I need to prepare for?
Expenses of homeownership to prepare for include:
You can learn more about all these costs in our guide to homeownership expenses.
What's the difference between a 15- and a 30-year mortgage?
With a 15-year loan, you make payments for just 15 years, as opposed to 30. The monthly amount you owe is higher on a 15-year loan than a 30-year loan because you make fewer payments. The interest rate is usually lower on a 15-year loan. And total interest costs are lower, because you pay interest for less time.
The "sweet spot" is the loan term that allows you to pay the mortgage off as quickly as possible without cutting your budget short each month.
A house loan calculator can help you weigh your options between a shorter plan and a lower monthly repayment.
What tips would you supply first-time home buyers?
Some of the best tips for first-time home buyers include:
For more information, look at our first-time home buyer tips.
Why does my debt-to-income ratio matter when applying for a mortgage?
Lenders consider your debt-to-income ratio when you apply for a mortgage because they want to know you can afford mortgage payments. They look at your:
If either ratio is too high, a lender won't approve your loan. For more information about lender requirements, read up on debt-to-income ratio and why it matters.
How does my credit score affect mortgage rates?
A higher credit score can result in a lower mortgage rate, since lenders view you as a low-risk borrower. A lower mortgage rate means lower monthly payments and less total interest paid over time.
A credit score on the low end can make it difficult to get approved for a loan. And lenders that do approve a mortgage will charge a higher rate. That's because credit problems suggest a greater chance a borrower will default on a loan.
Find out more about this by looking into how credit scores affect mortgage rates.
If you want to uncover more about the best mortgage lenders for low rates and fees, our experts have created a shortlist of the top mortgage companies. Some of our experts have even used these lenders themselves to cut their costs.
Home equity loans allow you to tap into your home’s equity without disturbing the rate on your primary mortgage. If you’re currently paying private mortgage insurance, a home equity loan could potentially impact your PMI in one specific instance. Generally speaking, however, the vast majority of homeowners seeking a home equity loan shouldn’t worry about it affecting how much they pay for PMI.
Yet just like much in the mortgage market, things can get complicated. Here’s a breakdown of the relationship between home equity loans and private mortgage insurance, with some basic explanations to start.
What is a home equity loan?
A home equity loan, commonly known as a second mortgage, is a fixed-rate installment loan secured by your house. Home equity loans offer you a one-time lump sum of cash that you’ll pay back over the life of the loan. To qualify for a home equity loan, most lenders require you to have at least 15% to 20% equity in your property, though some allow you to have much less, as low as 5% equity to qualify in certain cases.
A second mortgage doesn’t replace your existing mortgage. It’s an additional loan you take out and repay separately. You can also get a home equity loan if you own your home outright, meaning you have no mortgage.
What is private mortgage insurance?
PMI is a fee your lender charges depending on the size of your down payment. Generally, when you make a down payment that’s less than 20% of the home price, lenders will require you to pay PMI because the home loan is considered riskier.
Many homebuyers who put down smaller down payments have PMI. In 2020, 22.4% of conventional loans backed by Freddie Mac and Fannie Mae had PMI policies attached.
The cost of PMI will depend on a few factors, including the size of your loan and your credit score. PMI can be paid monthly or upfront in a lump sum.
Do home equity loans always affect PMI?
The short answer is: No.
For the majority of home equity loan borrowers, private mortgage insurance won’t even enter the equation during the application process. That’s because most lenders require you to have at least 15% to 20% equity in your property to qualify for a home equity loan. And once you have at least 20% equity built up in your home, you’re no longer required to pay for mortgage insurance.
However, because some lenders let you take out a home equity loan with much less equity, there’s a chance you could still be paying PMI at the time you want to borrow. In that situation, taking out a home equity loan still won’t affect the cost of your PMI, but it could impact when you’re eligible to stop paying PMI. That’s when something called your loan-to-value ratio could come into play.
What is the loan-to-value ratio?
The loan-to-value ratio, or LTV, is the relationship between your home’s appraised value and your current mortgage loan amount. For example, if your home has an appraised value of $500,000 and you take out a loan of $450,000 (equal to making a 10% down payment), your LTV is 90%. Since your down payment is less than 20%, you’ll have to pay PMI to your lender until you reach an LTV of 80%.
As you make mortgage payments and your home’s value appreciates, your LTV decreases. The loan-to-value ratio is a key consideration for lenders when determining whether you qualify for a home equity loan. Most (but not all) lenders aren’t willing to lend more than 80% of the home’s value.
How can a home equity loan affect PMI?
While it’s commonly misconstrued that a home equity loan will increase your LTV ratio and the amount of time you’re required to pay PMI,* that’s not actually the case.
Your LTV is based solely on your primary mortgage, meaning second mortgages like home equity loans aren’t factored into the calculation, according to Eileen Tu, vice president of product development and credit policy at Rocket Mortgage.
While a home equity loan could potentially impact when your PMI is canceled, it’s not because of an increase to your LTV, but rather due to a clause in the Homeowners Protection Act.
According to the Homeowners Protection Act, you can request that your PMI be canceled when you reach an LTV of 80%. But if you have a home equity loan, your lender is technically allowed to deny that request until your LTV ratio drops to 78% -- the point at which PMI is automatically canceled. The exact amount of time it takes for your LTV ratio to fall that extra 2% will depend on the size of your mortgage and your interest rate.
However, even this rare circumstance has a loophole. According to Seth Appleton, president of the US Mortgage Insurers, the bank could decide to deny the termination of PMI within that limited window, but it could also approve it. In other words, your lender might still grant your request to cancel PMI even if you have a home equity loan.
Note that if you aren’t paying PMI because your LTV ratio is already below 80%, you won’t have to worry about any potential conflict with a home equity loan.
*See below for a correction to our reporting on this question.
Can a home equity loan increase your loan-to-value ratio?
The LTV ratio is calculated based on your primary mortgage, whereas the combined loan-to-value ratio, or CLTV, factors in all loans secured by your house, including a home equity loan or a home equity line of credit. Private mortgage insurance only takes into account your LTV ratio on the original amortization schedule, not your CLTV ratio.
Even though taking out a home equity loan will increase your CLTV ratio, it will have no impact on your LTV ratio or your private mortgage insurance, according to Tu.
How to avoid or remove PMI
PMI is a course of debate in the world of personal finance. Private mortgage insurance borrowers are more likely to have lower credit scores and higher LTV ratios. While paying for PMI allows you to move into a home with a lower, more affordable down payment, it will increase your monthly mortgage payment.
Though the most straightforward way to avoid paying PMI is by making a 20% down payment upfront, that’s not always possible. If you end up having to cover PMI, it can be removed from your mortgage in one of the following three ways:
Other ways to remove PMI
There are other ways to avoid or remove PMI. If, for example, you’re able to refinance your mortgage and get a sufficiently lower interest rate, that may bring your new loan balance to below 80%. However, refinancing doesn’t make sense for many homeowners right now, due to the surge in mortgage rates over the past period.
You might also be eligible to stop paying PMI if your home’s value has appreciated since its purchase. That’s because even if you have the same loan balance, the increased value of your home would lower your LTV percentage. To determine if you already reached 80% LTV, you’d need a new appraisal on your home.
Correction, Oct. 18, 2023: An earlier version of this article misstated the effect that a home equity loan will have on your loan-to-value ratio. A home equity loan contributes to your combined loan-to-value ratio, but not your LTV ratio upon which PMI is based.
Editor’s note: The original version of this article was assisted by an AI engine. This article has been substantially revised and edited by CNET Money staff.
1056 ET – The dollar gains traction after disappointing Eurozone PMI data while the US Fed is expected to remain hawkish. The October flash PMI in the Eurozone fell to 46.5 from September’s 47.2, undershooting expectations of 47.6. “Our models point to yet more pain ahead, with the lagged impacts of higher rates and input prices still pressuring activity,” Piper Sandler’s Nancy Lazar and Karina Mayer say in a report. The Fed, meanwhile, is expected to keep rates steady next week, with a possible hike in December. The WSJ Dollar Index rises 0.3% as the greenback strengthens 0.7% versus the euro and 0.6% versus the pound. (firstname.lastname@example.org; @ptrevisani)
Dollar Recovers; Economic Data Weigh on Euro
1238 GMT – The dollar is recovering after three days of cumulative losses but traders could remain cautious ahead of several important economic data releases this week and the Federal Reserve’s interest-rates decision next week, says Denys Peleshok, head of Asia at CPT Markets. The U.S. currency followed the developments of treasury yields, with 10-year yields falling after briefly breaching the 5% level before rebounding again, he says in a note. The DXY dollar index is trading 0.3% higher at 105.920, while EUR/USD is trading 0.4% lower at 1.0625, weighed on by weak eurozone purchasing managers data. (email@example.com)
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Updated Nov. 2, 2023 10:31 pm ET
A private gauge of China’s services activities edged up in October, remaining in expansionary territory for 10 months in a row as Beijing ramped up efforts to shore up economic growth.
The Caixin services purchasing managers index climbed to 50.4 in October from September’s 50.2 which was the lowest of the year, Caixin Media Co. and S&P Global said Friday.
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