How to use the mortgage calculator
Enter the home price, your down payment, the loan term and the interest rate. The calculator shows your monthly mortgage payment and, with “Include taxes & costs” turned on, the full monthly cost of owning the home: property tax, homeowners insurance, private mortgage insurance (PMI), HOA fees and other costs such as maintenance.
Under “More options” you can let taxes and costs grow every year and add extra payments — monthly, yearly or one-time — to see how much sooner the loan is paid off and how much interest you save. The amortization graph and table below the results show how every payment is split between principal and interest, and you can export the full schedule as CSV or PDF. For a loan without taxes and insurance, use the amortization calculator.
How the monthly payment is calculated
Most home loans are fixed-rate amortizing loans: you pay the same principal-and-interest amount every month until the balance reaches zero. The mortgage payment formula is:
M = P × r × (1 + r)n / ((1 + r)n − 1)
- M — the monthly principal and interest payment;
- P — the loan amount (home price minus down payment);
- r — the monthly interest rate, the annual rate divided by 12;
- n — the number of monthly payments, the term in years times 12.
Example: a $400,000 home with 20% down leaves a loan of P = $320,000. At 7.25% for 30 years, r = 0.0725 / 12 = 0.0060417 and n = 360, so (1 + r)360 ≈ 8.7448 and M = 320,000 × 0.0060417 × 8.7448 / 7.7448 ≈ $2,182.96 a month. Over the life of the loan you pay about $465,867 in interest.
Property tax, homeowners insurance, PMI and HOA fees are added on top, each divided by 12. With property tax of 1.2% a year ($400 a month) and $1,500 a year of insurance ($125 a month), the monthly housing cost is about $2,708.
Monthly mortgage payment by loan amount
The table shows the monthly principal and interest on a 30-year fixed-rate mortgage. Property tax, insurance, PMI and HOA fees come on top; enter them in the calculator for your full monthly cost.
| Loan amount | 6.5% rate | 7% rate | 7.5% rate |
|---|---|---|---|
| $200,000 | $1,264 | $1,331 | $1,398 |
| $250,000 | $1,580 | $1,663 | $1,748 |
| $300,000 | $1,896 | $1,996 | $2,098 |
| $350,000 | $2,212 | $2,329 | $2,447 |
| $400,000 | $2,528 | $2,661 | $2,797 |
| $500,000 | $3,160 | $3,327 | $3,496 |
15-year vs 30-year mortgage
A shorter term raises the monthly payment but cuts the total interest sharply. With the same $320,000 loan at 7.25%, a 15-year mortgage costs about $2,921.16 a month — roughly $738 more — but the total interest falls to about $205,809, less than half of the 30-year loan. In practice 15-year loans also usually come with a lower rate: at 6.6% the payment is about $2,805.17 and the total interest about $184,930.
How much house can I afford?
Many lenders follow the 28/36 rule: your housing costs — the mortgage payment, property tax, insurance and HOA fees — should be no more than 28% of your gross monthly income, and all your debt payments together no more than 36%. With an income of $8,000 a month, that is up to $2,240 for housing and $2,880 for all debts. The house affordability calculator turns your income and debts into a home price, and the debt-to-income ratio calculator shows how lenders see your current debts. Not sure buying is the right move yet? Compare both options with the rent vs. buy calculator.
Costs to plan for besides the loan
- Property tax is set by local governments. In the U.S. it is often around 1% of the home's value per year, but it ranges from well under 0.5% to over 2% depending on the state and county.
- Homeowners insurance protects the home against damage and is required by lenders. Premiums depend on location, the size of the home and the coverage.
- PMI is usually required on conventional loans when the down payment is below 20%. It typically costs about 0.3% to 1.5% of the loan per year and can be removed once you reach 20% equity. Government-backed loans have their own insurance: see the FHA loan calculator and the VA mortgage calculator.
- HOA fees apply to condos and many planned communities and can rise over time.
- Maintenance and repairs — many owners budget about 1% of the home's value per year.
Ways to lower your mortgage cost
- Make a bigger down payment to borrow less and avoid PMI. The down payment calculator shows how much cash you need.
- Improve your credit score before applying — a better score usually means a lower rate.
- Compare lenders and look at the APR, which includes fees, not just the interest rate. The APR calculator finds the real rate of an offer.
- Pay extra toward principal. Even $100 a month can take years off a 30-year loan. Biweekly payments (half the monthly payment every two weeks) add up to one extra monthly payment a year. The mortgage payoff calculator compares the options.
- Refinance when rates drop. If rates fall after you buy, the refinance calculator shows the new payment and how long the closing costs take to pay back.