Mortgage Calculator

Calculate your monthly mortgage payment to understand how much home you can afford and plan your budget accordingly.

Loan Amount*(currency)

The principal amount you need to borrow (home price minus down payment).

Annual Interest Rate*(percent)

The annual mortgage interest rate.

Loan Term*(years)

The mortgage term in years. Common terms are 15 and 30 years.

Annual Property Tax(currency)

The estimated annual property tax (optional).

Annual Home Insurance(currency)

The estimated annual home insurance premium (optional).

This mortgage calculator helps home buyers estimate monthly payments based on loan amount, interest rate, and term. Includes options for property taxes and insurance.

How It Works

Mortgage Payment Formula

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

Monthly payment equals principal times the monthly rate growth factor divided by the growth factor minus one.

M is the monthly principal and interest payment

P is the loan principal amount

r is the monthly interest rate (annual rate divided by 12)

n is the total number of monthly payments

Important Notes:

•This calculator uses the standard mortgage amortization formula.
•Property taxes and insurance are divided by 12 and added to the monthly payment.
•This calculator does not include PMI (Private Mortgage Insurance), HOA fees, or other closing costs.

Worked Example

A buyer takes a $300,000 mortgage at 6.5% interest for 30 years, with $3,600 annual property tax and $1,200 annual insurance.

Inputs:

loan Amount:300,000
annual Interest Rate:6.5
loan Term Years:30
property Tax Annual:3,600
insurance Annual:1,200

Result:

The monthly principal and interest payment is approximately $1,896.20. With taxes and insurance included, the total monthly payment is approximately $2,346.20. Total interest paid over 30 years would be approximately $382,632.

Who Is This Calculator For?

home buyers
homeowners
real estate agents

Frequently Asked Questions

A 15-year mortgage has higher monthly payments but significantly less total interest. A 30-year mortgage has lower monthly payments but you pay much more interest over time. The 30-year is more common because it offers more flexibility, but the 15-year builds equity faster.

Many lenders require at least 3-5% down. A 20% down payment helps you avoid PMI and often gets you a better interest rate. However, many buyers successfully purchase homes with 10% or less down.

PMI (Private Mortgage Insurance) protects the lender if you default. It's typically required when your down payment is less than 20%. PMI adds to your monthly payment and can usually be removed once you reach 20% equity in the home.

Paying extra on your principal can save thousands in interest and pay off your loan years early. However, consider whether you could earn more by investing that money elsewhere. This decision depends on your interest rate, investment returns, and financial goals.

Related Tools

Related Calculators

Guides & Comparisons

Last updated: March 11, 2025