Mortgage Calculator
Calculate your monthly mortgage payment and see exactly how much of each payment goes toward principal versus interest. Enter your home price, down payment, interest rate, and loan term to get a complete breakdown. Understand your total cost of homeownership including property taxes, insurance, and HOA fees.
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How We Calculate This
This calculator uses the standard amortization formula: M = P[r(1+r)^n]/[(1+r)^n-1], where M is monthly payment, P is principal, r is monthly interest rate, and n is number of payments. Property taxes, insurance, and other expenses are added separately.
Frequently Asked Questions
How is my monthly mortgage payment calculated?
Your monthly mortgage payment is calculated using the loan amount, interest rate, and loan term. The formula accounts for the amortization of the loan, meaning early payments are mostly interest while later payments are mostly principal. Additional costs like property tax and insurance are added to get your total monthly payment.
How does the loan term affect my payment?
A shorter loan term means higher monthly payments but less total interest paid. A 15-year mortgage typically has lower interest rates than a 30-year mortgage, and you will pay significantly less interest over the life of the loan.
How much house can I afford?
A common guideline is that your total monthly housing payment should not exceed 28% of your gross monthly income (the "front-end ratio"). Your total debt payments including the mortgage should not exceed 36% of gross income (the "back-end ratio").
Should I put down 20%?
Putting down 20% reduces your loan amount and monthly payment. With less than 20% down, many lenders require Private Mortgage Insurance (PMI) which adds to your monthly costs. Consider your savings, emergency fund, and whether you could invest the difference.
How can I lower my monthly payment?
You can lower your monthly payment by: making a larger down payment, choosing a longer loan term, shopping for a lower interest rate, or buying a less expensive home. Refinancing later when rates drop is another option.
Related Calculators
You might also find these calculators helpful: Rent vs Buy Calculator, Home Affordability Calculator, and Loan Comparison Calculator.
This calculator provides estimates for educational purposes only. Actual mortgage terms, rates, and payments may vary. Consult with a mortgage lender for accurate quotes and pre-approval.