Mortgage Calculator

Home Price

Loan Term (years)

Start Date

Buying a home is one of the biggest financial decisions you'll ever make. Before you start house hunting, you need to know exactly how much your monthly payment will be. Our free mortgage calculator helps you figure out your payment in seconds. Just enter the home price, down payment, interest rate, and loan term to see your complete monthly breakdown.

Whether you're a first-time home buyer or looking to refinance, this calculator gives you accurate estimates for principal, interest, taxes, and insurance. You can compare different scenarios and find the mortgage that fits your budget.

What is a Mortgage Calculator?

A mortgage calculator is a free online tool that shows you how much you'll pay each month for a home loan. It takes the complex math out of mortgage planning and gives you instant results.

Here's what a mortgage calculator does:

Calculates your monthly principal and interest payment
Shows total interest paid over the loan term
Breaks down payment into PITI components
Helps you compare 15-year vs 30-year loans
Shows how different down payments affect your payment

What is PITI?

PITI stands for the four parts of a mortgage payment:

Principal - The actual loan amount you're paying back
Interest - What the bank charges you for borrowing money
Taxes - Property tax collected monthly and paid to your local government
Insurance - Homeowners insurance to protect your property

If your down payment is less than 20%, you'll also pay PMI (Private Mortgage Insurance). This protects the lender if you default on the loan. PMI typically costs 0.5% to 1.5% of your loan amount per year.

How to Use the Mortgage Calculator

Using our mortgage calculator is simple. Follow these steps to get your estimated monthly payment:

Enter the home price - Type the purchase price of the home you want to buy
Add your down payment - Enter the cash amount or percentage you'll pay upfront
Select the loan term - Choose 15, 20, or 30 years
Enter the interest rate - Use your quoted rate or current market rates
Add property taxes - Enter your estimated annual property tax
Include home insurance - Add your estimated yearly insurance cost
Click Calculate - See your complete payment breakdown

Example Calculation

Home price: $400,000 with 20% down payment ($80,000)

Loan amount: $320,000
Interest rate: 6.5% (30-year fixed)
Principal & Interest: $2,022/month
Property tax: $333/month ($4,000/year)
Home insurance: $150/month ($1,800/year)
Total monthly payment: $2,505

Over 30 years, you'll pay $407,920 in interest. With a 15-year loan at 6%, your payment would be $2,699, but you'd only pay $165,820 in interest - saving $242,100!

Mortgage Payment Formula

The mortgage calculator uses this standard formula to calculate your monthly payment:

M = P × [r(1+r)^n] / [(1+r)^n - 1]

Where:

M = Monthly payment
P = Principal (loan amount)
r = Monthly interest rate (annual rate ÷ 12)
n = Total number of payments (years × 12)

Don't worry about doing this math yourself - our calculator handles it instantly!

Understanding Your Monthly Payment

Principal and Interest

Your monthly payment is split between principal and interest. In the early years, most of your payment goes toward interest. As time passes, more goes toward principal. This process is called amortization.

For example, on a $300,000 loan at 6.5% for 30 years:

First payment: $375 to principal, $1,625 to interest
Year 15: $890 to principal, $1,006 to interest
Last payment: $1,869 to principal, $10 to interest

Property Taxes

Property taxes vary by location. The average in the US is about 1.1% of home value per year. Your lender usually collects this monthly and holds it in an escrow account. When taxes are due, they pay it for you.

Homeowners Insurance

Lenders require homeowners insurance to protect their investment. The average cost is $1,500 to $2,500 per year, depending on your location, home value, and coverage level. Like property taxes, this is often collected monthly through escrow.

Private Mortgage Insurance (PMI)

If your down payment is less than 20%, you'll pay PMI. This can add $100 to $300+ per month to your payment. The good news: once you reach 20% equity, you can request to remove PMI. At 22% equity, your lender must automatically cancel it.

Types of Mortgage Loans

Loan Type	Down Payment	Credit Score	Best For
Conventional (Fixed)	3-20%	620+	Buyers who want predictable payments
Conventional (ARM)	5%+	620+	Buyers planning to move within 5-7 years
FHA Loan	3.5%	580+ (500 with 10% down)	First-time buyers, lower credit scores
VA Loan	0%	No minimum (620 recommended)	Veterans, active military, surviving spouses
USDA Loan	0%	640+	Rural and suburban home buyers
Jumbo Loan	10-20%	700+	Expensive homes above conforming limits

15-Year vs 30-Year Mortgage

Choosing between a 15-year and 30-year mortgage is one of the biggest decisions you'll make. Here's how they compare:

Factor	15-Year Mortgage	30-Year Mortgage
Monthly Payment	Higher	Lower
Interest Rate	Usually 0.5-1% lower	Higher
Total Interest Paid	Much less	More than double
Build Equity	Faster	Slower
Best For	Those who can afford higher payments	Those who want lower monthly costs

Pro Tip: If you can't decide, consider a 30-year loan but make extra payments when possible. This gives you flexibility while still reducing your total interest.

Tips to Lower Your Mortgage Payment

Make a larger down payment - 20% or more eliminates PMI
Improve your credit score - Higher scores get lower rates
Shop multiple lenders - Compare at least 3-5 quotes
Consider a longer loan term - 30 years has lower payments than 15
Buy a less expensive home - Stay within the 28% rule
Look into down payment assistance - Many state programs available

Common Mistakes to Avoid

Only looking at principal and interest - Always include taxes, insurance, and PMI
Maxing out your budget - Keep payment under 28% of gross income
Forgetting closing costs - Budget 2-5% of loan amount extra
Skipping pre-approval - Get pre-approved before house hunting
Ignoring your credit score - Check and improve it before applying
Not comparing lenders - Rates can vary significantly

How Much House Can I Afford?

A common rule is the 28/36 rule:

28% Rule - Your housing payment (PITI) shouldn't exceed 28% of your gross monthly income
36% Rule - Your total debt payments shouldn't exceed 36% of gross income

For example, if you earn $6,000/month gross:

Maximum housing payment: $1,680 (28%)
Maximum total debt: $2,160 (36%)

These are guidelines, not strict rules. Some lenders allow up to 43% Debt-to-Income Ratio.

Frequently Asked Questions

How do I calculate my monthly mortgage payment?

Enter your home price, down payment, interest rate, and loan term into a mortgage calculator. It calculates your payment instantly using the standard amortization formula. Your payment includes principal, interest, and usually taxes and insurance.

What is a good mortgage interest rate in 2024?

As of 2024, mortgage rates typically range from 6% to 7.5% for 30-year fixed loans. A "good" rate depends on your credit score, down payment, and loan type. Rates in the lower 6% range are considered competitive. Check current rates with multiple lenders to find the best offer.

How much house can I afford with my salary?

Follow the 28% rule - your monthly housing payment should be no more than 28% of your gross monthly income. For a $75,000 salary ($6,250/month), you can afford about $1,750/month for housing. This typically means a home price of $300,000-$350,000 depending on rates and location.

What is the minimum down payment for a house?

The minimum depends on your loan type: Conventional loans require 3-5%, FHA loans require 3.5%, VA and USDA loans require 0%. However, putting down less than 20% means you'll pay PMI, which adds to your monthly cost.

How do I avoid paying PMI?

There are three ways to avoid PMI: put down 20% or more, get a VA loan (no PMI regardless of down payment), or use a piggyback loan (80-10-10 structure). Some lenders also offer lender-paid PMI where you accept a higher interest rate instead.

Is a 15-year or 30-year mortgage better?

It depends on your goals. A 15-year mortgage has higher monthly payments but saves significantly on interest (often 50%+ less). A 30-year mortgage has lower payments but costs more over time. Choose 15-year if you can afford it, 30-year if you need lower payments or want flexibility.

What credit score do I need to buy a house?

The minimum credit score varies by loan type: Conventional loans need 620+, FHA loans accept 580+ (500 with 10% down), VA loans have no official minimum but 620+ is recommended. Higher scores (740+) get the best interest rates and can save thousands over the loan term.

What are closing costs and how much should I expect?

Closing costs are fees paid when finalizing your mortgage, including appraisal, title insurance, attorney fees, and origination charges. Expect to pay 2-5% of the loan amount. On a $300,000 loan, that's $6,000 to $15,000. Some costs are negotiable or can be covered by the seller.

Can I pay off my mortgage early without penalty?

Most modern mortgages have no prepayment penalty, so you can pay extra anytime. Check your loan documents to confirm. Paying extra toward principal reduces your total interest and shortens your loan term. Even an extra $100/month can save years and thousands in interest.

What is the difference between fixed-rate and adjustable-rate mortgages?

A fixed-rate mortgage keeps the same interest rate for the entire loan term, giving you predictable payments. An adjustable-rate mortgage (ARM) has a fixed rate for an initial period (usually 5-7 years), then adjusts annually based on market conditions. ARMs often start with lower rates but carry more risk.

How do property taxes affect my mortgage payment?

Property taxes are usually included in your monthly mortgage payment through escrow. The average US property tax is about 1.1% of home value annually. On a $400,000 home, that's about $4,400/year or $367/month added to your payment. Rates vary significantly by location.

Should I get pre-approved before looking at houses?

Yes, always get pre-approved before house hunting. Pre-approval shows sellers you're a serious buyer, tells you exactly how much you can borrow, and speeds up the closing process. It's different from pre-qualification, which is just an estimate. Pre-approval involves a credit check and income verification.

What is mortgage amortization?

Amortization is how your loan balance decreases over time through scheduled payments. Each payment splits between principal and interest. Early payments are mostly interest; later payments are mostly principal. An amortization schedule shows exactly how much goes to each with every payment.

How much does mortgage insurance cost?

PMI typically costs 0.5% to 1.5% of your loan amount per year. On a $300,000 loan, that's $1,500 to $4,500 annually, or $125 to $375 monthly. FHA loans have MIP (mortgage insurance premium) that costs 1.75% upfront plus 0.85% annually for loans over 15 years.

Can I use a mortgage calculator for refinancing?

Yes, mortgage calculators work for refinancing too. Enter your current loan balance as the "loan amount," the new interest rate, and desired term. Compare the new payment to your current one. Factor in closing costs to see if refinancing saves money in the long run.

Ready to Calculate Your Payment?

Use our free mortgage calculator above to see exactly what you'll pay each month. Compare different scenarios and find the perfect mortgage for your budget.

Mortgage Calculator