Free · No sign-up · Updated August 2026
Mortgage Calculator Texas
No state income tax sounds like a win — and it is, on your paycheck. On your mortgage payment, Texas actually runs above the national average, because property tax carries more of the load here than almost anywhere else. This calculator builds that reality in.
Estimate your Texas mortgage payment
Updates liveIllustrative estimate only. Property tax rate defaults to a statewide approximate — actual rates vary by county, city, school district and any special districts. Not a loan offer or financial advice.
Diagram: Texas funds local government through property tax instead of income tax, which shows up directly in the mortgage payment.
Who checks this calculator
Understanding the Texas mortgage market
What makes a Texas mortgage different
No income tax is a real advantage on your paycheck. On your monthly mortgage payment, though, it's a different story — and understanding why is exactly what this mortgage calculator Texas tool is built to show, so you can budget for a Texas home with your eyes open.
The trade-off: no income tax, higher property tax
Texas is one of a handful of states with no state income tax at all, and that's a real boost to your take-home pay. But someone has to fund schools, roads, police and fire departments, and in Texas that job falls almost entirely on property tax. The result: an effective property tax rate that consistently ranks among the highest in the country, commonly cited in the 1.6% to 1.8% range statewide, well above the roughly 0.9% to 1.1% national average, according to the Texas Comptroller's office. This mortgage calculator Texas homeowners rely on builds that reality in from the start.
For anyone budgeting a Texas home purchase, the math looks different than it would in a lower-property-tax state with similar home prices. The interest rate isn't what sets Texas apart — it's the ongoing tax line that actually moves the monthly number.
How Texas property tax actually works
Property tax in Texas is set locally, not by the state. County appraisal districts determine your property's assessed value, then several overlapping taxing entities — your school district, county, city, and sometimes a special utility or hospital district — each apply their own rate on top of that value. Add all those individual rates together and you get your total effective property tax rate, which is exactly why it can look so different from one address to another even within the same city.
| Component | Typical contribution | Notes |
|---|---|---|
| School district tax | Largest single component | Usually the biggest piece of the total rate |
| County tax | Moderate | Funds county-level services |
| City tax | Varies | Only applies within incorporated city limits |
| Special districts | Varies | Utility, hospital, or emergency services districts where applicable |
| Typical combined effective rate | 1.6% – 1.8% | Statewide approximate, before homestead exemption |
The homestead exemption
If you'll live in the home as your primary residence, the Texas homestead exemption cuts your taxable value specifically for school district taxes, which lowers your effective bill compared to a non-owner-occupied property. Additional exemptions stack on top for homeowners 65 and older, disabled homeowners, and veterans, each shaving more off the taxable value used to calculate what you owe.
It isn't automatic, though. You typically have to file it with your county appraisal district after you move in, so it's worth doing the moment you're eligible rather than assuming it kicked in the day you closed.
The 10% appraisal cap
Once a homestead exemption is in place, Texas caps how much your home's appraised value can climb in a single year for tax purposes at 10%, no matter how much the actual market value rises. In a hot market, that cap can shield a long-term homeowner from a tax bill that spikes right along with rapid price growth — new buyers, whose assessed value starts at the purchase price, don't get that protection in year one.
A worked example, start to finish. Say a buyer purchases a $340,000 home in a Texas suburb with a combined effective property tax rate of 1.68%. With a 10% down payment, they're financing $306,000 at 6.6% over 30 years.
Their principal and interest payment comes to roughly $1,955 a month. Property tax on the $340,000 purchase price adds another $476 a month — a real chunk of the total payment next to what the same buyer would see in a lower-property-tax state. Tack on a typical Texas home insurance premium, often higher than the national average partly because of severe weather risk in parts of the state, and the full monthly payment lands around $2,532.
Once this buyer files their homestead exemption, next year's taxable value drops noticeably, and future increases are capped at 10% annually — so while the first year's bill reflects the full purchase price, the path from there is more predictable than it might first appear.
Why rates vary so much by county
Because Texas property tax is the sum of several independent local rates rather than one statewide number, two homes of similar value in different counties — or even different school districts within the same county — can end up with quite different total tax bills. Urban and suburban counties around Houston, Dallas-Fort Worth and Austin, where home values and the number of overlapping taxing districts both tend to run higher, often see higher total effective rates than smaller, rural counties.
How to use this mortgage calculator Texas tool
Enter the home price and down payment you're working with, along with your expected interest rate and loan term. The property tax rate defaults to a statewide typical figure of 1.68% — adjust it if you know your specific county and school district's actual combined rate, which your real estate agent or the county appraisal district's website can usually confirm. Add an estimated annual insurance premium, and this mortgage calculator Texas buyers use shows your full estimated monthly payment right away.
Home insurance considerations in Texas
Texas home insurance premiums tend to run above the national average, driven by the state's exposure to severe weather — hail, wind, and along the coast, hurricane risk. Coastal counties near the Gulf often carry noticeably higher premiums, and some coastal properties may need separate windstorm coverage through the Texas Windstorm Insurance Association if standard private coverage isn't available. Getting a location-specific quote before finalizing a purchase budget beats assuming a flat statewide average applies to your specific property.
Common mistakes to avoid
- Assuming no income tax means an overall lower cost of homeownership. Property tax often eats up a good chunk of that savings.
- Forgetting to file the homestead exemption after closing. It's not automatic, and skipping it means paying more than you have to.
- Using a single statewide tax rate without checking your specific county. Combined local rates can swing quite a bit by school district and city.
- Underestimating insurance in coastal or severe-weather-prone areas. A generic national insurance estimate can badly understate real Texas costs.
- Assuming the appraisal cap applies from your first year. The 10% cap only kicks in once the homestead exemption is filed and in place.
Quick glossary
- Appraisal district
- The county-level office responsible for determining a property's assessed value for tax purposes in Texas.
- Homestead exemption
- A reduction in taxable value for an owner-occupied primary residence, lowering the school district portion of a Texas tax bill.
- Effective property tax rate
- The combined total of all overlapping local tax rates — school, county, city and special districts — expressed as a percentage of home value.
- 10% appraisal cap
- A Texas rule limiting annual increases in a homestead property's appraised value to 10%, regardless of market value growth.
- Special district
- A local taxing entity, such as a utility or hospital district, that can add its own rate on top of standard county, city and school taxes.
The bottom line
A Texas mortgage payment tells a different story than the "no income tax" headline suggests — property tax carries real weight here, often 1.6% to 1.8% of your home's value every year. File your homestead exemption as soon as you're eligible, confirm your specific county and school district's combined rate instead of leaning on a statewide average, and this mortgage calculator Texas tool gives you a realistic starting point for what owning a home here actually costs each month.
Common questions