What Would My Monthly Payment Be on a $600,000 House?

The rapid increase in house prices over the past couple of years means that coming across homes you'll need a $600,000 mortgage to buy isn't uncommon in many parts of the country.

With interest rates potentially coming down this year, home buyers could see a little relief soon.

But if you're in the market for a $600,000 house right now, here's how much it could cost you and what contributes to your monthly payment.

How much your payment will be each month

Your monthly payment on a $600,000 house will depend on multiple factors, including:

• How big your down payment is
• What interest rate you receive from your lender
• Property taxes where the house is located
• If you have a homeowners association (HOA) fee
• Whether or not you have to pay private mortgage insurance (PMI)
• Your homeowners insurance premiums

For example, let's assume you put 20% of the $600,000 house toward the down payment. The current mortgage rate for buyers with good credit is about 6.5%. With these factors, you'll pay $3,035 monthly for the principal and interest on a $600,000 house.

Of course, you may pay more than this. If your down payment is less than 20%, you'll likely have to pay for private mortgage insurance. Plus, the average homeowner pays $2,377 annually for homeowners insurance and $4,062 in property taxes, which could add $537 to your monthly payment.

Lower rates could be on the way soon

The good news is that buying a house could soon be a bit cheaper. Many economists think the Federal Reserve will cut the federal funds rate in September and potentially several times over the next year.

While mortgage rates aren't directly tied to the federal funds rate, they typically move in the same direction. And a series of rate cuts could bring additional mortgage rate relief.

For example, the monthly principal and interest mortgage payment for a $600,000 house with a 6% interest rate is $2,878 -- $1,884 less every year than a 6.5% rate.

There are a few ways you can put yourself in a good position to get the best rate possible, including:

• Paying down your debts
• Having a credit score of 760 or higher
• Make a significant down payment, ideally 20%
• Compare mortgage lender quotes

Many people may wrongfully assume that all lenders will offer the same interest rate, but it's not true. While many of the core financial requirements are the same, lenders sometimes calculate the borrower risk differently. And some may be more competitive than others in trying to match an interest rate quote you get from another lender.

A $600,000 house is a big purchase, so it's important to have your finances in order first. Lowering your debt is a great first step, which will not only improve your debt-to-income ratio but will also help raise your credit score.

And if you're looking for the lowest monthly payment possible for your home, you might want to keep a close eye on any dips in mortgage interest rates before making a move.