Mortgage Calculator
Mortgage Calculator
Work out your monthly mortgage payment with property tax, home insurance, mortgage insurance and HOA fees included, see how much interest you pay over the loan, and what extra payments each month would save.
Balance and payments over the loan
Principal and interest = loan × r ÷ (1 − (1 + r) to the power −n), where r is the annual rate ÷ 12 and n is the number of monthly payments. Property tax is a percentage of the home price a year, spread over 12 months. Mortgage insurance applies when the loan is more than 80% of the price and stops here when the balance falls to 78% of the price. Extra payments go straight to principal. Amounts in any currency work the same way. The CSV, image and printed report contain the values you entered, nothing preloaded.
How to use this tool
Enter the price of the home, your down payment as a percentage or a dollar amount, the interest rate and the loan term. The total monthly payment appears at the top, split into principal and interest, property tax, insurance, mortgage insurance and HOA fees, with the total interest over the loan and a year by year amortization table. Add an extra monthly payment to see how much sooner the loan is paid off and how much interest that saves.
The figure people most often get wrong is the payment they compare. A lender’s quote or an online ad usually shows principal and interest only, while what leaves your account each month also includes tax and insurance, and on a small down payment mortgage insurance too. On a $400,000 home those can add $500 or more a month, so compare the totals.
What the calculation is doing
A fixed rate mortgage is an amortizing loan: every payment is the same, and each one first covers the interest owed for that month, with the rest reducing the balance. Interest is charged on what you still owe, so early on, when the balance is large, most of the payment is interest. As the balance falls, less goes to interest and more to principal, until the last payment is almost all principal.
The payment formula, loan × r ÷ (1 − (1 + r) to the power −n), is the level payment that brings the balance to exactly zero after n months at a monthly rate r. Tax and insurance do not follow that formula; they are simply added each month, and the tax usually rises over time as the home is reassessed.
Why the first years are mostly interest, and what extra payments do
On $320,000 at 6.5%, the first month’s interest is 320,000 × 0.065 ÷ 12 = $1,733.33, so only $289.28 of the $2,022.62 payment reduces the balance. Interest takes the larger share of each year’s payments until year 20. That is why the balance barely moves in the first decade, and why selling or refinancing after a few years leaves most of the loan still owed.
Extra principal works from the other end. Every dollar paid early stops accruing interest for the rest of the loan, so a small amount each month compounds into a large saving: $200 a month on this loan cuts the term to 23 years 5 months and saves $105,429. Because the required payment stays the same, you keep the flexibility to stop the extra when money is tight, which a shorter term does not allow.
Mortgage insurance protects the lender, not you, when the down payment is under 20%. At 0.5% a year on a $360,000 loan it adds $150 a month. It can be cancelled on request when the balance is scheduled to reach 80% of the original value and must end automatically at 78%, so on a 30 year loan at 6.5% with 10% down it lasts about 9 years. Extra payments bring that point forward.
Payment per $100,000 borrowed
Principal and interest a month for each $100,000 of loan. Multiply by the loan in hundreds of thousands: a $320,000 loan at 6.5% over 30 years is 3.2 × $632.07 = $2,022.62.
| Rate | 15 years | 20 years | 30 years | Interest over 30 years |
|---|---|---|---|---|
| 4% | $739.69 | $605.98 | $477.42 | $71,870 |
| 5% | $790.79 | $659.96 | $536.82 | $93,256 |
| 6% | $843.86 | $716.43 | $599.55 | $115,838 |
| 6.5% | $871.11 | $745.57 | $632.07 | $127,544 |
| 7% | $898.83 | $775.30 | $665.30 | $139,509 |
| 8% | $955.65 | $836.44 | $733.76 | $164,155 |
A worked example you can check on paper
A $400,000 home with 20% down leaves a $320,000 loan. At 6.5% the monthly rate is 0.065 ÷ 12 = 0.0054167, and 30 years is 360 payments. (1.0054167) to the power −360 = 0.143025, so principal and interest = 320,000 × 0.0054167 ÷ (1 − 0.143025) = $2,022.62.
Property tax at 1% of the price is $4,000 a year, $333.33 a month, and insurance at $1,800 a year is $150.00 a month. With 20% down there is no mortgage insurance, so the total is 2,022.62 + 333.33 + 150.00 = $2,505.95 a month.
Over the loan you make 360 payments of $2,022.62, which is $728,142.36, and take away the $320,000 borrowed to leave $408,142.36 of interest. Check the first month: interest is $1,733.33, principal is $289.28, and the balance drops to $319,710.72.
Mistakes that catch people out
Comparing the rate instead of the APR. The annual percentage rate folds in points and many lender fees, so two loans with the same rate can cost different amounts. The payment here uses the note rate, which is what sets the monthly payment.
Forgetting that tax and insurance change. The principal and interest on a fixed rate loan never change, but property tax and insurance usually rise, and the escrow payment rises with them.
Expecting mortgage insurance to drop at 80% on its own. At 80% you have to ask for cancellation; the automatic cut off is 78% of the original value, on schedule. Keep track of the date.
Sending extra money without instructions. Some servicers hold extra money toward the next payment rather than reducing principal. Mark it as a principal payment and check the next statement.
Leaving out closing costs. Lender fees, title insurance, appraisal and prepaid escrow are paid at closing on top of the down payment and often add 2% to 5% of the price to the cash you need.
Popular calculations
Each opens the calculator with those values filled in, and they can be changed once it is open. Unless shown otherwise they use 20% down, 6.5% for 30 years, 1% property tax, $1,800 a year of insurance and 0.5% mortgage insurance.
Monthly payment by home price
Down payment
Interest rate
Loan term
Extra payments
How this was checked
The payment formula was checked against the standard textbook case, $200,000 at 6% for 30 years, which gives $1,199.10, and every amortization schedule was checked so that the principal paid adds up exactly to the loan and the balance reaches zero on the last payment. Total interest was checked two ways: summed month by month, and as the payment times the number of payments minus the loan. The mortgage insurance rule follows the Consumer Financial Protection Bureau description of cancellation at 80% on request and automatic termination at 78% of the original value.
Every address in the lists above was then opened and checked for a distinct title, the right monthly payment, a chart that renders, and clean CSV, image and print output containing only the values entered, at desktop, tablet and phone widths.
Common questions
How is a monthly mortgage payment calculated?
Principal and interest come from the loan amount, the monthly rate and the number of payments: loan × r ÷ (1 − (1 + r) to the power −n). $320,000 at 6.5% for 30 years has r = 0.065 ÷ 12 and n = 360, which gives $2,022.62. Property tax, insurance, mortgage insurance and any HOA fees are then added on top.
What is included in a mortgage payment?
Usually four parts, often shortened to PITI: principal, interest, property tax and homeowners insurance. The lender often collects tax and insurance monthly into an escrow account and pays the bills for you. Mortgage insurance is added when the down payment is under 20%, and HOA fees are normally paid separately to the association but still count toward what the house costs each month.
When does mortgage insurance go away?
On a conventional loan you can ask the servicer to cancel it once the balance is scheduled to reach 80% of the home’s original value, and it must end automatically at 78%, as long as payments are up to date. With 10% down on a $400,000 home at 6.5%, the balance reaches 78% of the price after about 9 years. FHA loans follow different rules.
Is a 15 year mortgage better than a 30 year?
A 15 year loan costs more each month but far less in total. At 6.5% on $320,000 the payment rises from $2,022.62 to $2,787.54, yet total interest falls from $408,142 to $181,758, and 15 year loans often carry a lower rate as well. A 30 year loan with extra payments keeps the lower required payment while still cutting interest.
How much does paying extra each month save?
On the $320,000 loan at 6.5%, $200 extra a month pays it off in 23 years 5 months instead of 30 years and saves $105,429 in interest. Make sure the lender applies extra money to principal rather than holding it toward the next payment.
How much house can I afford?
A common guideline is to keep the full monthly payment, including tax and insurance, under about 28% of gross monthly income, and all debt payments under about 36%. Lenders use their own limits, so treat these as a starting point and run the numbers here with your own tax and insurance figures.
Related Calculators and Reference
- Loan Payment Calculator: the same amortization for car loans and personal loans.
- Credit Card Payoff Calculator: clear higher rate debt before taking on a mortgage.
- Present Value Calculator: what the stream of mortgage payments is worth in today’s money.
- Square Footage Calculator: price per square foot when comparing homes.
- Inflation Calculator: how a fixed payment shrinks in real terms over the years.
- Auto Loan Calculator: the same payment maths for a car, with trade in and sales tax.
- Refinance Calculator: when a lower rate could beat the closing costs.
- Home Affordability Calculator: work backwards from income and debts to a price you can carry.
- Rent vs Buy Calculator: whether owning beats renting over your time horizon.
- Cap Rate Calculator: find NOI, cap rate and debt service coverage for a rental property.
- Consumer Financial Protection Bureau: When can I remove PMI: the 80% and 78% rules for mortgage insurance.