Mortgage Calculator
How It Works
A mortgage calculator estimates your monthly home loan payment based on the details of your loan. Enter your home price, down payment, interest rate, and loan term, and the calculator instantly shows you what your monthly payment would be — including principal and interest, property taxes, homeowner's insurance, and PMI if applicable.
The core inputs are your home price and down payment, which together determine your loan amount. Your interest rate and loan term (typically 15 or 30 years) determine how much interest you pay and how quickly you build equity. Property tax and insurance estimates complete the full picture of your monthly housing cost — often called PITI (Principal, Interest, Taxes, Insurance).
Use our calculator to model different scenarios: How much does your payment drop if you put 20% down instead of 10%? What if rates fall by 0.5%? How much more principal do you pay off each year with a 15-year loan? Seeing these numbers side by side helps you make a confident decision before you talk to a lender.
If your down payment is less than 20% of the purchase price, lenders typically require Private Mortgage Insurance (PMI). Our calculator adds this automatically — and shows you the PMI line item disappear when you adjust your down payment above the 20% threshold.
Mortgage Payment Formula
Your monthly principal and interest payment is calculated using the standard amortization formula:
M = P × [r(1+r)^n] / [(1+r)^n − 1]
- M — Monthly payment
- P — Principal loan amount (home price minus down payment)
- r — Monthly interest rate (annual rate ÷ 12 ÷ 100)
- n — Total number of payments (loan term in years × 12)
Worked Example
Home Price: $400,000
Down Payment: $80,000 (20%)
Interest Rate: 6.5% / year
Loan Term: 30 years
P = $400,000 − $80,000 = $320,000
r = 6.5 ÷ 12 ÷ 100 = 0.005417
n = 30 × 12 = 360 payments
M = $320,000 × [0.005417 × (1.005417)^360] / [(1.005417)^360 − 1]
Monthly P&I = $2,022.62
This is just the principal and interest portion. Adding typical property tax ($300/mo) and homeowner's insurance ($100/mo) brings the full monthly housing payment to approximately $2,422.62.
Frequently Asked Questions
Related Tools
Mortgage Answers at a Glance
How is mortgage interest calculated?
Mortgage interest is calculated by multiplying your outstanding loan balance by your monthly interest rate. Each month, the interest portion decreases as your balance shrinks through regular payments. On a $320,000 loan at 6.5%, your first month's interest is approximately $1,733 — but by year 15, the interest portion drops below $1,000 per payment as more goes toward principal.
How much house can I afford?
Most lenders recommend keeping your total monthly housing payment below 28% of your gross monthly income. This is known as the front-end debt-to-income ratio. For a household earning $100,000 per year, that means a maximum housing payment of about $2,333 per month — covering principal, interest, taxes, and insurance combined.
What is a good mortgage interest rate?
A good mortgage rate is one that is at or below the current national average for your loan type and credit profile. Rates vary daily based on economic conditions, your credit score, down payment size, and loan term. Borrowers with credit scores above 740 and down payments of 20% or more typically qualify for the most competitive rates available.
How much does PMI cost per month?
PMI typically costs between 0.5% and 1.5% of your original loan amount per year, divided into monthly payments. On a $300,000 loan, that translates to $125–$375 per month. PMI is required when your down payment is less than 20% and can be removed once your loan-to-value ratio drops below 80%.
How We Calculate This
This mortgage calculator uses the standard fixed-rate amortization formula used by banks and lenders worldwide to determine your monthly principal and interest payment:
M = P × [r(1+r)^n] / [(1+r)^n − 1]
- P = Principal (loan amount after down payment)
- r = Monthly interest rate (annual rate ÷ 12 ÷ 100)
- n = Total number of monthly payments (years × 12)
- M = Fixed monthly payment (principal + interest only)
Property taxes, homeowner's insurance, and PMI are added separately to give you the full PITI (Principal, Interest, Taxes, Insurance) monthly payment.
Common Use Cases
- Estimate your monthly mortgage payment before applying — compare 15-year vs. 30-year loan terms and see how different down payment amounts change your payment
- Determine how much house you can afford on your budget — adjust the home price and down payment to find a monthly payment that fits your income
- Compare mortgage offers from multiple lenders — plug in different interest rates to see the impact on your total cost over the life of the loan
- See how PMI affects your payment — find the exact down payment threshold where private mortgage insurance drops off and your monthly cost decreases