Finance & business
Mortgage Calculator
Enter your home price, down payment, loan term and interest rate to see your monthly principal & interest, the full monthly payment including property tax and home insurance, and the total cost over the life of the loan. Most American homebuyers finance with a 30-year fixed mortgage, but this tool lets you model any term so you can weigh a lower monthly payment against the interest savings of a shorter loan. Because your real housing bill is more than just principal and interest — lenders bundle property taxes and insurance into an escrow account known as PITI — entering those annual amounts gives you a far more realistic monthly number. It updates as you type, runs entirely in your browser, and shows the exact amortization formula below.
Mortgage details
principal, interest, tax & insurance
Assumes a fixed rate, equal monthly payments and constant tax/insurance. PMI, HOA fees and closing costs are not included.
How the mortgage calculator works
Your loan amount is the home price minus your down payment. The monthly principal & interest is found with the standard amortization formula — the same fixed-rate math lenders use. Each month you pay the same principal & interest amount; early payments are mostly interest and later payments are mostly principal.
If you enter annual property tax or home insurance, they are divided by 12 and added on top to give your full monthly housing payment (often called PITI).
Amortization formula
M = P × r × (1 + r)ⁿ ÷ [ (1 + r)ⁿ − 1 ]where: P = loan amount = home price − down payment r = monthly interest rate = annual rate ÷ 12 ÷ 100 n = number of monthly payments = term in years × 12 M = monthly principal & interest
Total monthly payment is M + tax/12 + insurance/12. Total interest is (M × n) − loan amount. When the rate is 0%, principal & interest reduces to P ÷ n.
Notes & assumptions
- Assumes a fixed interest rate for the entire term and equal monthly payments.
- Property tax and home insurance are treated as constant annual amounts split evenly across 12 months.
- Does not include PMI, HOA dues, closing costs or escrow adjustments.
- Calculations are for general information only — verify with your lender before relying on them.
Worked example: $300,000 home with 20% down
Take the calculator's default scenario: a $300,000 home, a $60,000 down payment (20%), and a 30-year fixed loan at 6.5%. You finance $240,000 across 360 monthly payments. The monthly rate is 6.5% ÷ 12 = 0.541667%, and the amortization formula returns monthly principal & interest of $1,516.96. Every dollar figure in this example and the tables below is computed from the formula and rounded to the nearest cent.
That covers only the loan. Add $3,600 a year in property tax ($300.00 a month) and $1,200 a year in homeowners insurance ($100.00 a month) and the full PITI payment comes to $1,916.96. Over the whole term you hand the lender $546,106.77 in principal and interest combined, of which $306,106.77 is interest. The interest bill exceeds the original $240,000 loan, which is the single most surprising number for first-time buyers and the reason rate shopping is worth real effort.
One more way to read that payment: against the 28% affordability guideline described in the FAQ below, carrying a $1,916.96 PITI payment comfortably calls for gross income of about $6,846.29 a month, or roughly $82,155 a year. Run your own numbers in the calculator above to see where a different price or down payment puts you.
Year-by-year amortization schedule
A fixed payment hides a moving split. The very first payment charges interest of $240,000 × 0.541667% = $1,300.00, leaving just $216.96 for principal. Twenty-nine years later the proportions have nearly reversed. The table below tracks the same $240,000 loan at 6.5% through seven checkpoints. Rows are computed with the unrounded payment, so the balance lands on exactly $0.00 after payment 360.
| Year | Interest paid that year | Principal paid that year | Balance at year end |
|---|---|---|---|
| 1 | $15,521.02 | $2,682.54 | $237,317.46 |
| 5 | $14,726.93 | $3,476.63 | $224,666.35 |
| 10 | $13,396.02 | $4,807.54 | $203,462.70 |
| 15 | $11,555.61 | $6,647.95 | $174,141.94 |
| 20 | $9,010.66 | $9,192.90 | $133,596.68 |
| 25 | $5,491.45 | $12,712.11 | $77,529.99 |
| 30 | $625.04 | $17,578.52 | $0.00 |
Notice how slowly the balance moves at first. After five full years of payments you have retired only $15,333.65 of principal while paying $75,684.14 in interest. The crossover, where a year's principal finally outweighs its interest, does not arrive until the loan's third decade. This is also why selling after just a few years often disappoints: almost everything you paid went to interest, not equity.
What a different rate does to the payment
Rate matters more than most buyers expect, and small-looking differences compound over 360 payments. Each row below keeps the same $240,000 loan and 30-year term and changes only the rate. From 5.0% to 8.0% the monthly principal & interest climbs by $472.66 and lifetime interest grows by $170,158.71.
| Rate | Monthly P&I | Total interest over 30 years |
|---|---|---|
| 5.0% | $1,288.37 | $223,813.88 |
| 5.5% | $1,362.69 | $250,569.70 |
| 6.0% | $1,438.92 | $278,011.65 |
| 6.5% | $1,516.96 | $306,106.77 |
| 7.0% | $1,596.73 | $334,821.36 |
| 7.5% | $1,678.11 | $364,121.34 |
| 8.0% | $1,761.03 | $393,972.59 |
A practical read on this loan size: each half-point of rate moves the payment by roughly $74 to $83 a month and swings lifetime interest by $26,000 to $30,000. That is the budget you are negotiating over when you compare lender quotes, improve your credit score before applying, or weigh paying discount points up front.
30-year vs 15-year on the same loan
Term is the other big lever. Keep the $240,000 loan at 6.5% and shorten the term to 15 years: the payment rises to $2,090.66 but total interest falls from $306,106.77 to $136,318.38, a saving of $169,788.39. In practice 15-year loans usually price below 30-year loans; at 6.0% the payment is $2,025.26 and total interest drops to $124,546.15. In that case you would pay $508.30 more per month than the 30-year loan at 6.5% and keep $181,560.62 that would otherwise have gone to interest. If the higher payment fits your budget with room to spare, the shorter term is one of the few guaranteed returns in personal finance.
Frequently asked questions
What's included in a monthly mortgage payment?
A typical U.S. mortgage payment has four parts, often abbreviated PITI: principal, interest, taxes and insurance. Principal and interest pay down the loan itself, while your lender usually collects property tax and homeowners insurance in an escrow account and pays those bills on your behalf. If you put down less than 20%, private mortgage insurance (PMI) is commonly added too, and homes in certain communities may also owe HOA dues.
What is PMI and when do I have to pay it?
Private mortgage insurance protects the lender if you default, and it's typically required when your down payment is below 20% of the home price on a conventional loan. It's added to your monthly payment until you build enough equity — usually around 20% — at which point you can request to cancel it. This calculator doesn't include PMI, so add it separately if your down payment is under 20%.
How do property tax and insurance escrow work?
Rather than billing you a large lump sum once or twice a year, most lenders divide your annual property tax and homeowners insurance into 12 equal pieces and collect them with each mortgage payment. That money sits in an escrow account, and the lender pays the tax and insurance bills when they come due. Because rates and assessments change, your escrow portion can rise or fall from year to year.
Should I choose a 15-year or 30-year mortgage?
A 30-year loan keeps your monthly payment low and is the most popular choice for U.S. buyers, but you pay far more interest over time. A 15-year loan has a higher monthly payment yet usually a lower rate and dramatically less total interest, helping you build equity faster. The right choice depends on your budget, how long you plan to stay, and whether you value cash-flow flexibility or long-term savings more.
How much house can I afford?
A common rule of thumb is to keep your total housing payment (PITI) at or below 28% of your gross monthly income, and all debt payments under about 36% — the so-called 28/36 rule lenders often use. Your down payment, interest rate, credit score and other debts all factor in. Use this calculator to test different home prices and down payments until the monthly payment fits comfortably within your budget.
What are mortgage points and are they worth buying?
One discount point costs 1% of the loan amount and typically trims the rate by about 0.25 percentage points, though lenders vary. On a $240,000 loan, one point costs $2,400. Dropping the rate from 6.5% to 6.25% cuts the monthly principal and interest from $1,516.96 to $1,477.72, a saving of $39.24 a month, so the point pays for itself in about 61 months. Buying points makes sense if you expect to keep the loan well past that break-even, and not if you plan to sell or refinance sooner.
How do extra principal payments change the schedule?
Every extra dollar reduces the balance immediately, so all future interest accrues on a smaller amount. Paying an extra $200 a month on the $240,000 loan at 6.5% retires it in 262 payments instead of 360, about 21.8 years, and cuts total interest from $306,106.77 to $209,837.22, a saving of $96,269.55. Ask your servicer to apply the extra amount to principal rather than crediting it as an early payment for next month.