Mortgage Calculator
Estimate your monthly home loan payments including taxes, insurance, and HOA fees.
Mortgage Summary
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| Month | Interest | Principal | Balance |
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What is a Mortgage Calculator?
A mortgage calculator estimates your monthly home loan payment from the home price, down payment, interest rate, and loan term. It shows what a house will really cost each month and how much interest you will pay over the life of the loan, before you ever speak with a lender.
Beyond principal and interest, it also factors in annual property taxes, homeowners insurance, and monthly HOA fees, then generates a full amortization schedule so you can watch your balance shrink payment by payment.
How to Use
- Enter the purchase price of the home and your planned down payment.
- Set the loan term using the slider (5 to 40 years) and input the annual interest rate.
- Add estimated annual property tax, home insurance, and any monthly HOA fees.
- Click Calculate to see your monthly payment, total interest, payoff date, and full amortization schedule.
The Mortgage Payment Formula
Lenders compute the monthly principal-and-interest payment on a fixed-rate loan with the standard amortization formula:
M = P·r(1+r)n / ((1+r)n − 1)
- M is the monthly payment, covering principal and interest only.
- P is the principal: the amount borrowed, i.e. the home price minus your down payment.
- r is the monthly interest rate — the annual rate divided by 12. For 6.5%, r = 0.065 / 12 ≈ 0.005417.
- n is the total number of payments: the term in years times 12. A 30-year loan has n = 360.
Because interest is charged on the remaining balance, early payments are mostly interest; as the balance falls, more of each payment goes toward principal.
Worked Example: $400,000 Home with 20% Down
Buy a $400,000 home with 20% down ($80,000) and finance the rest with a 30-year fixed-rate loan at 6.5%:
- Principal: P = $400,000 − $80,000 = $320,000
- Monthly rate: r = 0.065 / 12 ≈ 0.005417
- Number of payments: n = 30 × 12 = 360
Plugging in: M = 320,000 × 0.005417 × (1.005417)360 / ((1.005417)360 − 1) = $2,022.62 per month. Over 360 payments you pay $728,142.36 in total, of which $408,142.36 is interest — more than the original loan. The first payment puts $1,733.33 toward interest and only $289.28 toward principal.
Monthly Payment per $100,000 Borrowed
Multiply the figure for your rate and term by however many hundreds of thousands you borrow:
| Interest Rate | 15-Year Term | 30-Year Term |
|---|---|---|
| 5% | $790.79 | $536.82 |
| 6% | $843.86 | $599.55 |
| 7% | $898.83 | $665.30 |
A $250,000 loan at 6% for 30 years costs 2.5 × $599.55 ≈ $1,498.88 per month. Shorter terms cost more monthly but slash interest: a 15-year $320,000 loan at 6.5% runs $2,787.54 per month with $181,757.84 total interest — about $226,385 less than the 30-year version.
PITI: Principal, Interest, Taxes, and Insurance
Your true monthly housing cost is PITI — principal, interest, taxes, and insurance — with taxes and insurance typically collected in an escrow account.
Property Taxes and Homeowners Insurance
Property taxes commonly run 0.5% to 2.5% of assessed value per year depending on state and county, and homeowners insurance averages roughly $1,200–$2,000 per year. On our example, $3,600 in annual taxes and $1,200 in annual insurance add $400 per month, lifting the total payment from $2,022.62 to $2,422.62.
Private Mortgage Insurance (PMI)
With less than 20% down, conventional lenders usually require private mortgage insurance, which protects the lender if you default. PMI typically costs 0.2% to 2% of the loan amount per year — at 0.5%, a $320,000 loan adds about $133 per month. You can request cancellation at 20% equity, and it must end automatically at 78% loan-to-value. This calculator does not add PMI, so include it separately if it applies.
Fixed-Rate vs. Adjustable-Rate Mortgages
With a fixed-rate mortgage, the interest rate and principal-and-interest payment never change, which makes long-term budgeting simple; the 30-year fixed is America's most popular home loan.
An adjustable-rate mortgage (ARM) starts lower for an initial period — 5, 7, or 10 years on products like a 5/1 or 7/1 ARM — then adjusts with a market index within contractual caps. ARMs can suit buyers who expect to sell or refinance before the first adjustment, but payments can rise sharply if rates climb.
How Extra Payments Shorten Your Loan
Every extra dollar goes straight to principal, shrinking the balance future interest is charged on. On our $320,000 loan at 6.5%:
- Adding $100 per month pays the loan off in 314 months instead of 360 — nearly 4 years early — and saves about $61,698 in interest.
- Adding $200 per month pays it off in 281 months (23 years and 5 months), saving roughly $105,429 in interest and cutting 6 years and 7 months off the term.
Before prepaying, confirm there is no prepayment penalty and ask your servicer to apply extra amounts to principal.
Frequently Asked Questions
What is included in the total monthly payment?
The total monthly payment includes principal and interest on the loan, plus one-twelfth of annual property taxes and insurance, plus any monthly HOA fees.
How is the monthly mortgage payment calculated?
Lenders use the amortization formula M = P·r(1+r)^n / ((1+r)^n − 1), where P is the loan principal, r is the monthly interest rate, and n is the number of monthly payments. A $320,000 loan at 6.5% for 30 years works out to $2,022.62 per month.
How does a larger down payment affect my mortgage?
A larger down payment reduces your loan amount, which lowers your monthly payment and total interest paid over the life of the loan. It may also help you avoid private mortgage insurance (PMI).
What is PMI and when can I get rid of it?
Private mortgage insurance is required on most conventional loans with less than 20% down and typically costs 0.2% to 2% of the loan amount per year. You can request cancellation at 20% equity, and lenders must terminate it automatically at a 78% loan-to-value ratio.
What is an amortization schedule?
An amortization schedule is a table showing each payment broken down into interest and principal, and the remaining loan balance after each payment. Early payments are mostly interest; later payments are mostly principal.
Should I choose a fixed-rate or an adjustable-rate mortgage?
A fixed-rate mortgage keeps the same rate and payment for the entire term, offering maximum predictability. An adjustable-rate mortgage starts lower but can rise after the initial fixed period, so it suits buyers who plan to move or refinance within a few years.
How do extra payments affect my mortgage?
Extra payments go directly toward principal, so less interest accrues from then on. On a $320,000 loan at 6.5% for 30 years, adding $200 per month saves about $105,429 in interest and pays the loan off 79 months early.