How to use the mortgage calculator
- Enter the home price and your down payment, as a percent of the price or as a dollar amount.
- Choose the loan term (30, 20, 15 or 10 years, or a custom number of years) and enter the interest rate (APR) from your lender quote.
- Open More options to add property tax, home insurance, HOA dues and mortgage insurance (PMI). Enter each as a monthly or yearly amount. You can also add an extra monthly payment.
- Read the total monthly payment, the principal and interest, the total interest and the payoff time. Use the yearly table on the page, or download the CSV for every month.
Formula
Loan amount L = home price - down payment
Monthly rate r = APR / 12, number of payments n = years x 12
Payment = L x r / (1 - (1 + r)^-n), rounded to the cent
Each month: interest = remaining balance x r (rounded to the cent); principal = payment - interest
Total monthly payment = principal and interest + tax + insurance + HOA + PMI
At 0% APR the payment is simply the loan amount divided by the number of payments. The final payment is whatever clears the balance, so rounding never leaves a few cents behind.
Worked examples
The basics: a $375,000 home with 20% down ($75,000) leaves a $300,000 loan. At 6.5% for 30 years the payment is $1,896.20 a month. In month 1, interest is $300,000 x 0.065 / 12 = $1,625.00, so only $271.20 reduces the balance. Over 360 payments you pay $682,636.71, of which $382,636.71 is interest.
A shorter term: the same loan over 15 years costs $2,613.32 a month. Total interest falls to $170,398.28, about $212,000 less, in exchange for roughly $717 more each month.
With extra payments: adding $200 a month to the 30-year loan ends it after 277 payments instead of 360. That is 83 months (almost 7 years) sooner and $103,450.19 less interest. Adding escrow items: property tax of $4,500 a year ($375 a month), insurance of $1,800 a year ($150) and HOA dues of $50 raise the monthly total to $2,471.20.
Why the first years are mostly interest
Interest is charged on the remaining balance, so it is highest at the start. On the 30-year example, the first year of payments totals $22,754.40, and $19,401.28 of that is interest. Only $3,353.12 reduces the principal, leaving a balance of $296,646.88. The split gradually reverses, and by the final years almost every dollar goes to principal.
This is also why extra payments in the early years save so much. Each extra dollar removes principal that would otherwise be charged interest for decades. The yearly summary table shows the shift, and the CSV lists every month.
Taxes, insurance, HOA and PMI
Lenders often collect property tax and homeowners insurance in an escrow account and add them to your monthly bill. HOA dues and mortgage insurance (PMI) may be added too, and PMI is often required when the down payment is under 20%. This calculator does not look any of these up. Enter the figures from your tax bill, insurance quote and lender estimate, either per month or per year.
These amounts are held constant and are not part of the amortization schedule. In real life they change, and your escrow payment is adjusted when they do.
Comparing offers fairly
Compare loans by APR, term and the total interest over the time you expect to keep the loan, not only by the monthly payment. A lower payment from a longer term usually means much more total interest. Your lender's Loan Estimate lists the exact figures, including points and closing costs that this tool does not model.
Assumptions and limits
- A fixed-rate loan with equal monthly payments made at the end of each month. Adjustable-rate loans are not modeled.
- Interest each month is the remaining balance times APR / 12, rounded to the nearest cent. Real lenders may use slightly different rounding or day-count rules.
- Property tax, insurance, HOA and PMI are the amounts you enter, held constant. Nothing is looked up by state or county, and PMI is not removed when you reach 20% equity.
- Points, origination fees, closing costs, prepaid items and any rate changes are not included.
- An extra monthly payment is applied entirely to principal, every month, starting with the first payment.
- This is an estimate for planning, not a loan offer or financial advice. Your lender's disclosure is the source of truth.
Frequently asked questions
How is a monthly mortgage payment calculated?
The payment comes from the standard amortization formula using the loan amount, the monthly rate (APR divided by 12) and the number of monthly payments. Property tax, insurance, HOA dues and PMI are then added to get the total monthly cost.
How much does an extra payment save?
It depends on the rate, the balance and how early you start. On a $300,000 loan at 6.5% for 30 years, an extra $200 a month saves about $103,450 in interest and 83 months. Enter your own extra amount to see your numbers.
Is the down payment a percent or a dollar amount?
Either. Choose the option beside the down payment field. A percent is applied to the home price, so 20% of $375,000 is $75,000. The result shows the amount and the percent either way.
Why does my lender's payment differ from this estimate?
Common reasons are different tax or insurance estimates, mortgage insurance, rounding, a different closing date that changes the first payment, or fees rolled into the loan. Use the lender's Loan Estimate for the exact number.
What does the CSV contain?
The CSV lists every monthly payment with the principal, interest and remaining balance for principal and interest only. Open it in a spreadsheet to sort, chart or share it. Tax, insurance, HOA and PMI are not in the schedule.