How to use this mortgage calculator
- Home price – the purchase price of the property.
- Down payment – type an amount or a percentage; the other field updates automatically. Putting at least 20% down usually avoids private mortgage insurance (PMI).
- Interest rate – the yearly rate offered by your lender (not the APR).
- Loan term – most US mortgages are 30 or 15 years.
- Open Taxes, insurance & fees to add property tax, homeowners insurance and HOA dues and see your real monthly cost.
The mortgage payment formula
Fixed-rate mortgages use the standard amortization formula, where P is the loan amount, r the monthly interest rate (annual rate ÷ 12) and n the number of monthly payments:
M = P × r × (1 + r)ⁿ ÷ ((1 + r)ⁿ − 1)
In the first years most of each payment goes to interest. As the balance falls, a growing share goes to principal — you can see this in the amortization schedule.
Example
A $350,000 home with 20% down ($70,000) leaves a $280,000 loan. At 6.5% for 30 years, the principal-and-interest payment is about $1,770 per month, and you would pay roughly $357,000 in interest over the life of the loan. The same loan over 15 years costs about $2,440 a month but saves more than $190,000 in interest.
Tips to lower your mortgage cost
- Compare offers from at least three lenders — a 0.5% lower rate can save tens of thousands.
- A shorter term means higher payments but far less interest.
- Extra payments toward principal shorten the loan and cut total interest.
- Improve your credit score before applying; it has a big effect on the rate you get.
Frequently asked questions
What is included in a monthly mortgage payment?
Principal and interest, plus — in most cases — property tax and homeowners insurance (often paid through an escrow account). Some homes also have HOA dues and, with less than 20% down, private mortgage insurance (PMI).
How much house can I afford?
A common rule is that your total housing cost should stay below about 28% of your gross monthly income, and all debts together below about 36%. Use the calculator to test different prices until the monthly cost fits your budget.
Is it better to choose a 15-year or a 30-year mortgage?
A 15-year loan usually has a lower rate and much less total interest, but a higher monthly payment. A 30-year loan is more affordable month to month and leaves room in your budget.
Does this calculator store my data?
No. Everything is calculated in your browser and nothing is sent or saved.
Results are estimates for information only and are not financial, legal or medical advice. Rates, taxes and fees vary — confirm with a professional or your lender.