Mortgage Calculator

Estimate your monthly mortgage payment, total interest, and overall cost. Enter the home price, down payment, annual interest rate, and loan term to see a full breakdown.

How It Works

We apply the standard amortization formula M = P[r(1+r)^n]/[(1+r)^n-1] to compute principal and interest, then summarize total payments over the life of the loan.

What You Can Compare

Adjust the down payment, rate, and term (15, 20, or 30 years) to see how each factor changes your monthly payment and lifetime interest.

How Mortgage Payments Are Calculated

A mortgage payment consists of principal and interest, commonly referred to as P&I. The standard formula uses the loan amount, annual interest rate divided by 12 for the monthly rate, and the total number of monthly payments. For a fixed-rate mortgage, the formula produces equal monthly payments throughout the loan term. Each payment allocates a portion to interest based on the remaining balance and the rest to reducing principal. Early in the loan, most of each payment goes to interest, gradually shifting toward principal over time. This is called amortization.

Factors Affecting Your Monthly Payment

Beyond the basic P&I calculation, your total monthly housing payment typically includes property taxes, homeowners insurance, and potentially Private Mortgage Insurance if your down payment is below 20 percent. These additional costs can add 30 to 50 percent to your base payment. Interest rate is the single largest factor affecting affordability. A 1 percent rate difference on a 300000 dollar loan changes the monthly payment by approximately 175 dollars and the total interest paid by over 60000 dollars over 30 years. Loan term also matters significantly: a 15-year mortgage has higher monthly payments but saves substantial interest compared to a 30-year term. Use our calculator above to compare different scenarios and find the optimal balance between monthly affordability and total cost.

Tips for Getting the Best Mortgage Rate

Improve your credit score above 740 for the best rates. Save at least 20 percent for a down payment to avoid PMI. Compare offers from at least three lenders including banks, credit unions, and online lenders. Consider paying discount points to buy down your rate if you plan to stay long-term. Lock your rate when you find a good offer as rates fluctuate daily. Our Complete Mortgage Guide provides detailed strategies for every stage of the home buying process.

Frequently Asked Questions

How is a monthly mortgage payment calculated?

A standard fixed-rate mortgage payment is calculated with the amortization formula M = P[r(1+r)^n] / [(1+r)^n − 1], where P is the loan principal (home price minus down payment), r is the monthly interest rate (the annual rate divided by 12), and n is the total number of monthly payments (years × 12). The result, M, is the fixed amount you pay each month toward principal and interest. Our calculator runs this formula instantly and also shows the total interest you will pay over the full term, so you can see the real lifetime cost of the loan rather than just the headline monthly figure.

Does this mortgage calculator include taxes and insurance?

The core calculation covers principal and interest, which is the part of your payment set by the loan amount, interest rate, and term. In practice, most homeowners also pay property taxes, homeowners insurance, and sometimes private mortgage insurance (PMI) or HOA dues, which lenders often bundle into a monthly escrow. These extras can add several hundred dollars to your real monthly outlay. When budgeting, add an estimate for taxes and insurance on top of the principal-and-interest figure this tool provides so you get a realistic picture of total housing costs.

How much should my down payment be?

A larger down payment reduces the amount you borrow, lowers your monthly payment, and cuts the total interest you pay over the life of the loan. A 20% down payment is a common benchmark because it typically lets you avoid private mortgage insurance, but many buyers put down less. Use the calculator to test different down payment amounts side by side — even a modest increase can noticeably reduce both your monthly payment and your lifetime interest, helping you decide how much cash to commit upfront versus keeping in reserve.

Should I choose a 15-year or 30-year mortgage?

A 15-year mortgage has higher monthly payments but a lower interest rate and dramatically less total interest, because you repay the balance in half the time. A 30-year mortgage spreads payments out, making each month more affordable, but you pay far more interest overall. The right choice depends on your budget and goals: choose 15 years if you can comfortably afford the higher payment and want to be debt-free sooner; choose 30 years for lower monthly commitment and flexibility. Enter both terms in the calculator to compare the monthly and lifetime numbers directly.

Can extra payments help me pay off my mortgage faster?

Yes. Any extra amount paid toward your principal reduces the outstanding balance, which means future interest is calculated on a smaller number. Over time this shortens your loan term and can save tens of thousands in interest. Even one extra payment per year, or rounding your monthly payment up, makes a measurable difference. Before committing to extra payments, confirm your lender applies them to principal and check there is no prepayment penalty.