For most people, buying a house is the biggest transaction of their lives. You’ll be paying on the mortgage loan for the next few decades, so it makes sense that you would take care in choosing the right loan.

Not all mortgages are created equally. There are many different types of mortgages. The basic distinction is made between fixed-rate and adjustable-rate mortgages, which have interest rates that either stay the same or change based on market interest rates. You’ll have to choose the one that’s best for you.

Adjustable-rate mortgages aren’t all bad. ARMs got a bad rep when the subprime mortgage industry suffered a meltdown beginning in 2006. Many homeowners saw their ARMs resetting at higher interest rates and the monthly payments subsequently became unaffordable. However, adjustable rate mortgages don’t always reset at such high interest rates and can be beneficial for homebuyers who plan to move within a few years.

Your credit history influences whether you qualify and how much you pay. Mortgage lenders review your credit history not only to decide whether you qualify for a mortgage loan, but also to decide your interest rate. The better your credit, the lower your interest rate will be. Unfortunately, homebuyers with worse credit pay higher interest rates.

You’ll be paying interest and principal. Unless you’re making interest-only payments, your monthly mortgage payments will be split between principal, which is the cost of the home (minus your down payment) and interest, which is the cost of borrowing the loan. Depending on your interest rate and loan term, you could end up paying just as much interest as principal.

Private mortgage insurance is required if you pay less than 20% down. This insurance is required by the mortgage lender to offset the risk of you defaulting on your loan. Private mortgage insurance, or PMI, is 0.5% of your loan amount and is paid until you reach 22% equity in your home. This could take up to 15 years depending on your interest rate and repayment period.

Longer mortgage terms have lower payments, but you’ll pay more interest. Many people are familiar with the 30-year mortgage, but there are also 10-, 15-, and 20-year mortgage terms. The lower your mortgage term, the higher your monthly payment will be. You benefit from a lower mortgage term by paying less interest and owning your home sooner.

Bigger down payments usually mean lower loan payments. Bigger down payments have several benefits. First, you avoid paying private mortgage insurance if your down payment is 20% or more. Second, you can purchase a bigger house than if you had no down payment. Also, your monthly payments are lower than if you had no down payment. Down payment puts you closer to full ownership of your home.

Using a mortgage calculator takes out much of the guesswork. You can’t always trust a lender or mortgage broker to tell you the truth about what you can afford. Before you start home shopping use an online mortgage calculator to help you figure out how much you can afford to pay each month for mortgage and what size mortgage loan you can afford. Doing this work upfront will help make sure you pick the right size home.