Mortgage Calculator
Calculate your monthly mortgage payments including principal, interest, taxes, and insurance with a detailed amortization schedule.
Loan Summary
Amortization Schedule
| Month | Payment | Principal | Interest | Balance |
|---|
How to Use the Mortgage Calculator
Calculate your complete monthly mortgage payment including principal, interest, taxes, insurance, and PMI. This calculator provides a detailed breakdown and visual representation of your payment components.
- Enter the home price and your down payment amount
- Select your loan term (15, 20, or 30 years)
- Enter your interest rate (annual percentage rate)
- Add property tax and home insurance annual costs
- Include PMI if your down payment is less than 20%
- View your total monthly payment, payment breakdown chart, and full amortization schedule
Mortgage Payment Formula
Monthly Principal & Interest Payment:
M = P × [r(1 + r)^n] / [(1 + r)^n - 1]
Where:
- M = Monthly payment (principal & interest)
- P = Principal loan amount (home price - down payment)
- r = Monthly interest rate (annual rate / 12 / 100)
- n = Total number of payments (years × 12)
Total Monthly Payment:
Total = M + (Property Tax / 12) + (Insurance / 12) + PMI
For example, a $240,000 loan at 6.5% for 30 years: Monthly P&I = $1,516.69. With $3,600 annual tax ($300/month) and $1,200 insurance ($100/month), total monthly payment = $1,916.69.
Mortgage Payment Examples
- $200,000 loan at 6% for 30 years: $1,199.10/month (P&I only)
- $300,000 loan at 7% for 30 years: $1,995.91/month (P&I only)
- $400,000 loan at 6.5% for 15 years: $3,482.43/month (P&I only)
- $250,000 loan at 5.5% for 20 years: $1,720.35/month (P&I only)
- Adding costs: $1,500 P&I + $250 tax + $100 insurance + $100 PMI = $1,950 total
Understanding Mortgage Payments
A mortgage payment consists of multiple components bundled into one monthly payment. The principal and interest portion pays down your loan. Property taxes are held in escrow and paid to local government. Homeowners insurance protects against damage and is required by lenders.
Private Mortgage Insurance (PMI) is required when your down payment is less than 20% of the home price. PMI typically costs 0.5% to 1% of the loan amount annually and can be removed once you reach 20% equity. For example, on a $240,000 loan, PMI might cost $100-200 per month.
Amortization describes how your payment is split between principal and interest over time. Early payments are mostly interest, while later payments are mostly principal. This is because interest is calculated on the remaining balance, which decreases as you pay down principal.
The loan term significantly impacts your payment and total interest. A 15-year mortgage has higher monthly payments but saves substantial interest compared to a 30-year loan. For example, a $240,000 loan at 6.5% costs $314,197 in interest over 30 years but only $119,443 over 15 years.
Mortgage Best Practices
Before Buying
- Get pre-approved -- A pre-approval letter shows sellers you're a serious buyer and locks in a rate for 60-90 days. Get pre-approved before house hunting.
- Save for more than the minimum down payment -- While 3-5% down is possible, aiming for 20% eliminates PMI and reduces your monthly payment significantly.
- Budget for closing costs -- Expect 2-5% of the home price in closing costs (appraisal, title insurance, origination fees, etc.). On a $300,000 home, that's $6,000-$15,000.
- Factor in all housing costs -- Beyond the mortgage, budget for property taxes, insurance, maintenance (1-2% of home value annually), HOA fees, and utilities.
Choosing the Right Mortgage
- Fixed vs. adjustable rate -- Fixed-rate mortgages provide payment certainty. ARMs offer lower initial rates but can increase after the fixed period. Choose fixed if you plan to stay 7+ years.
- Consider buying points -- Paying 1% of the loan amount upfront (one point) typically reduces your rate by 0.25%. Worth it if you plan to stay in the home long enough to recoup the cost.
- Shop at least 3 lenders -- Rate quotes can vary by 0.5% or more between lenders. Even a 0.25% difference on a $300,000 loan saves $15,000+ over 30 years.
Mortgage Type Comparison
| Mortgage Type | Min. Down Payment | PMI Required? | Best For |
|---|---|---|---|
| Conventional (30-yr fixed) | 3% | Yes, if <20% down | Most buyers with good credit (680+) |
| Conventional (15-yr fixed) | 3% | Yes, if <20% down | Buyers who want fast equity and lower total cost |
| FHA Loan | 3.5% | Yes (MIP for life) | First-time buyers, lower credit scores (580+) |
| VA Loan | 0% | No | Veterans and active military |
| USDA Loan | 0% | No (has guarantee fee) | Rural area buyers, low-to-moderate income |
| Adjustable Rate (5/1 ARM) | 5% | Yes, if <20% down | Short-term owners (5-7 years), lower initial payment |
Tip: If you're a first-time buyer with less than 20% down, compare FHA and conventional loans carefully. FHA has lower credit requirements but charges mortgage insurance for the life of the loan, while conventional PMI can be removed once you reach 20% equity.