Mortgage Calculator

Enter the home price, down payment, rate and term. You get the full monthly payment (principal, interest, tax, insurance, PMI, HOA), the total interest, the payoff date and what an extra monthly payment saves.

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How the monthly payment is calculated

The principal and interest part of a fixed-rate mortgage uses the standard formula M = P × r × (1 + r)n ÷ ((1 + r)n − 1), where P is the loan amount, r the monthly rate (yearly rate ÷ 12) and n the number of monthly payments. A $320,000 loan at 6.5% for 30 years is $2,022.62 a month before taxes and insurance.

Most lenders collect property tax and home insurance with the payment (an escrow account), so the real monthly cost, often called PITI, is higher than principal and interest alone. The calculator adds both, plus PMI and HOA fees when they apply.

What PMI is and how to avoid it

Private mortgage insurance protects the lender when you put down less than 20% on a conventional loan. It usually costs roughly 0.3% to 1.5% of the loan per year, depending on your credit score and down payment. It drops off automatically when the balance reaches 78% of the original home value, and you can ask to remove it at 80%. FHA loans have their own mortgage insurance with different rules.

15 or 30 years?

A 15-year loan has a higher monthly payment but a lower rate and far less total interest. Try both terms above and look at the "Total interest" line. A middle path is a 30-year loan with an extra monthly payment: you keep the lower required payment and still cut years off the loan. The extra payment field shows how much interest and time it saves.

How much house can I afford?

A common rule of thumb is the 28/36 rule: keep the full housing payment under about 28% of gross monthly income, and all debt payments under about 36%. Lenders use their own limits, and a payment you are comfortable with may be lower than what you qualify for.

Property tax rates

Property tax in the US is set locally and ranges from well under 1% of a home's value per year in some states to over 2% in others. Use the rate from the county assessor or the listing, not a national average, for a real budget.

FAQ

What is the monthly payment on a $400,000 house?
With 20% down ($80,000), a $320,000 loan at 6.5% for 30 years is about $2,023 a month for principal and interest. Property tax and insurance add several hundred dollars, depending on where you live.
Does this include taxes and insurance?
Yes. It adds property tax, home insurance, PMI (when the down payment is under 20%) and HOA fees to principal and interest.
How much do extra payments save?
Enter an amount in "Extra payment". The result shows the interest saved and how much sooner the loan is paid off.
Is this a loan offer?
No. It is an estimate for planning. Your lender's numbers depend on your credit, points, fees and local taxes.

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