Compare a 'no-cost' vs. traditional mortgage

Many lenders will offer a 'no-cost' loan in lieu of a traditional mortgage. 'No-cost' loans are generally priced at a higher interest rate than a traditional mortgage. The higher rate allows the lender to make enough money on the interest rate spread from the underwriter to pay for all your closing costs and provide them with their profit. Use this calculator to help determine if a no-cost loan with your lender is better than a traditional mortgage.
Amount of loan ($) 
Number of years 
Mortgage Rates
No-Cost LoanTraditional Mortgage
Annual interest rate
Traditional Loan Closing Costs
Discount points (% of loan) (%) 
Origination fees (% of loan) (%) 
Lender fees (processing and underwriting) ($) 
Credit report ($) 
Appraisal ($) 
Title insurance ($) 
Reconveyance fee ($) 
Recording fee ($) 
Wire and courier fee ($) 
Endorsement fee ($) 
Title closing fee ($) 
Document preparation ($) 
Other fees ($) 
How do you plan to pay closing costs? 
Comparison Assumptions
Comparison options/cost of moneyhelp
Marginal tax bracket (%)help
Years to compare total costs: 

This information may help you analyze your financial needs. It is based on information and assumptions provided by you regarding your goals, expectations and financial situation. The calculations do not infer that the company assumes any fiduciary duties. The calculations provided should not be construed as financial, legal or tax advice. In addition, such information should not be relied upon as the only source of information. This information is supplied from sources we believe to be reliable but we cannot guarantee its accuracy. Hypothetical illustrations may provide historical or current performance information. Past performance does not guarantee nor indicate future results.

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