Mortgage Calculator

Calculate your monthly mortgage payments, total interest paid, and amortization schedule based on home price, down payment, interest rate, and loan term.

Home Price Total purchase price of the home

Down Payment Amount you plan to pay upfront

Down Payment Percentage: 20%

Interest Rate Annual interest rate (percentage)

Loan Term

Annual Property Tax Annual property tax amount (optional)

Annual Home Insurance Annual home insurance premium (optional)

Monthly HOA Fees Monthly homeowners association fees (optional)

Include PMI (Private Mortgage Insurance)

Quick Examples:

How to Use This Calculator

Enter the total home price you're considering purchasing
Input your planned down payment amount or use the slider to set a percentage
Enter the expected interest rate for your mortgage
Select your preferred loan term (typically 15 or 30 years)
Optionally add property tax, insurance, and HOA fees for a complete monthly payment estimate
Click Calculate to see your monthly payment, total interest, and amortization schedule

Formula Used

M = P[r(1+r)^n]/[(1+r)^n-1]

Where:

M = Monthly payment
P = Principal loan amount (Home Price - Down Payment)
r = Monthly interest rate (Annual Rate / 12 / 100)
n = Number of payments (Loan Term in years × 12)

Example Calculation

Real-World Scenario:

Let's calculate the mortgage for a typical first home purchase with a 30-year fixed-rate mortgage.

Given:

Home Price = $300,000
Down Payment = $60,000 (20%)
Interest Rate = 4.5% annually
Loan Term = 30 years
Property Tax = $3,600 annually
Home Insurance = $1,200 annually

Calculation:

Principal Loan Amount = $300,000 - $60,000 = $240,000

Monthly Interest Rate = 4.5% / 12 = 0.375% = 0.00375

Number of Payments = 30 years × 12 = 360 months

Monthly Principal & Interest = $240,000 × [0.00375(1+0.00375)^360] / [(1+0.00375)^360 - 1] = $1,216.04

Monthly Property Tax = $3,600 / 12 = $300

Monthly Home Insurance = $1,200 / 12 = $100

Total Monthly Payment = $1,216.04 + $300 + $100 = $1,616.04

Why This Calculation Matters

Practical Applications

Determine affordability of homes within your budget
Compare different loan options and terms
Plan for additional homeownership costs beyond principal and interest
Understand how much of your payment goes toward interest vs. principal over time

Key Benefits

Helps you budget for one of life's largest purchases
Shows the long-term financial impact of different down payment amounts
Demonstrates how interest rates affect total cost of homeownership
Provides insight into building home equity over time

Common Mistakes & Tips

Many first-time homebuyers focus only on the principal and interest payment but forget about property taxes, insurance, HOA fees, and maintenance costs. These additional expenses can add 20-30% or more to your monthly housing costs. Always budget for these expenses when determining what you can afford.

A seemingly small difference in interest rates can have a massive impact on your total payment over the life of the loan. For a $300,000 30-year mortgage, the difference between a 4% and 5% interest rate is more than $60,000 in total interest paid. Always shop around for the best rate and consider improving your credit score before applying.

If you put down less than 20% of the home's purchase price, most lenders will require Private Mortgage Insurance (PMI), which protects the lender if you default. PMI typically costs 0.5% to 1% of the loan amount annually. This additional cost can add $100-$200 or more to your monthly payment, so consider saving for a larger down payment if possible.

Frequently Asked Questions

A 15-year mortgage has higher monthly payments but significantly less interest paid over the life of the loan. A 30-year mortgage has lower monthly payments but you'll pay much more in interest over time. For example, on a $300,000 loan at 4.5% interest, a 15-year mortgage would cost about $2,280 monthly with $110,000 in total interest, while a 30-year mortgage would cost about $1,520 monthly with $247,000 in total interest.

Conventional wisdom suggests putting down at least 20% to avoid PMI. However, many loan programs allow for smaller down payments. FHA loans require as little as 3.5% down, and VA loans may require no down payment for eligible borrowers. The right amount depends on your financial situation, goals, and the loan programs available to you.

An amortization schedule is a table that shows how each payment is split between principal and interest over the life of the loan. In the early years of a mortgage, most of your payment goes toward interest. Over time, the balance shifts, and more of your payment goes toward reducing the principal. This schedule helps you understand how your loan balance decreases and how much equity you're building in your home.

References & Disclaimer

Financial Disclaimer

This mortgage calculator provides estimates for educational purposes only. The calculations do not represent a loan offer or pre-qualification. Actual interest rates, terms, and monthly payments may vary based on your credit score, down payment, lender, and other factors. Consult with a qualified mortgage professional before making any financial decisions.

References

Consumer Financial Protection Bureau - Owning a Home - Comprehensive resources for homebuyers from the U.S. government's consumer finance watchdog
Freddie Mac Mortgage Rates - Current mortgage rate trends and market analysis from one of America's largest mortgage lenders
HUD - Buying a Home - Information about various loan programs and homebuying assistance from the Department of Housing and Urban Development

Accuracy Notice

This calculator rounds to the nearest dollar and does not account for all possible fees, closing costs, or specific loan program requirements. Property tax and insurance estimates may vary significantly based on location and property type. PMI calculations are estimates and actual rates may vary by lender and borrower qualifications. For precise figures, consult with mortgage lenders and obtain a formal Loan Estimate.

About the Author

Kumaravel Madhavan

Web developer and data researcher creating accurate, easy-to-use calculators across health, finance, education, and construction and more. Works with subject-matter experts to ensure formulas meet trusted standards like WHO, NIH, and ISO.

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finance loans-credit mortgage loan tax

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