The median new home price was $403,200 in early 2026. Mortgages require repaying principal plus interest, which impacts monthly payments and total cost. Interest is calculated on the outstanding principal, decreasing as the loan is paid down. Factors affecting rates include credit score, down payment, loan term, debt-to-income ratio, loan type, and market conditions. Extra payments reduce interest and shorten loan duration. Tax deductions may apply if itemizing.