Mortgage Calculator
Calculate your monthly mortgage payment including principal, interest, taxes, insurance, and other costs. Get a complete breakdown of your home loan expenses.
Enter Your Information
Why Use This Calculator?
Calculate Complete Monthly Costs
Understand your full PITIA payment - Principal, Interest, Taxes, Insurance, and Association fees. Know exactly what you'll pay each month before signing any paperwork.
Compare 15 vs 30 Year Terms
See the dramatic difference in total interest between loan terms. A 15-year mortgage costs more monthly but can save you over $100,000 in interest on a typical home.
Determine Your Down Payment Strategy
Understand the impact of different down payment amounts. See when you avoid PMI (at 20% down) and how larger down payments reduce your monthly burden and total interest.
Plan for Hidden Homeownership Costs
Property taxes and insurance can add $300-$1,000+ to your monthly payment. Factor in these often-overlooked expenses to avoid payment shock.
Understand Your Amortization Schedule
Early mortgage payments go mostly toward interest (often 80%+). See when you start building real equity and plan strategic refinancing or extra payment timing.
Make Confident Homebuying Decisions
Enter negotiations knowing your real budget. Avoid overextending by understanding how home price, rate, and down payment affect your monthly obligation.
Step-by-Step Guide
Enter Your Home Price
Start with the purchase price of the home you're considering or the price range you're targeting.
Example:
Example: $350,000 for a single-family home in a suburban area
Calculate Your Down Payment
Enter how much you can put down. Remember: 20% avoids PMI, but many loans accept 3-10% down for qualified buyers.
Example:
Example: $70,000 (20% of $350,000) or $17,500 (5% for FHA loan)
Choose Your Loan Term
Select 15, 20, or 30 years. Shorter terms mean higher payments but less total interest; longer terms offer lower payments with more interest paid.
Example:
Example: 30-year term offers $280/month lower payments than 15-year, but costs $144,000 more in interest
Enter Current Interest Rate
Use the rate you've been quoted by lenders or current average rates. Even 0.5% difference significantly impacts your payment.
Example:
Example: 6.5% might cost $1,767/month while 7.0% costs $1,862/month on $280,000 loan
Add Property Tax Estimate
Research your area's property tax rate (usually 0.5-2.5% of home value annually) and enter the annual amount.
Example:
Example: 1.2% rate on $350,000 home = $4,200/year = $350/month
Include Homeowners Insurance
Get quotes from insurance providers or estimate $1,000-$2,500/year based on home value, location, and coverage needs.
Example:
Example: $1,500/year = $125/month for standard HO-3 policy with $1,000 deductible
Calculate PMI if Needed
If down payment is under 20%, estimate PMI at 0.3-1.5% of loan amount annually. Your lender will provide exact rates.
Example:
Example: 0.5% PMI on $280,000 loan = $1,400/year = $117/month
Add HOA Fees if Applicable
Enter monthly homeowners association fees if buying a condo, townhouse, or home in a planned community.
Example:
Example: $150-$400/month typical for condo communities with amenities
Review Your Total Payment
Examine the complete monthly cost breakdown and ensure it fits within 28% of your gross monthly income for comfortable affordability.
Example:
Example: $2,500/month total payment requires ~$8,900/month income ($107,000/year)
Compare Different Scenarios
Adjust variables to see how larger down payments, shorter terms, or lower rates affect your payment and total interest paid.
Example:
Example: Increasing down payment from 5% to 10% eliminates $58/month PMI and reduces payment
Real-World Examples
First-Time Buyer with FHA Loan
Result: Total Monthly Payment: $2,220
With an FHA loan requiring only 3.5% down, this first-time buyer has a $265,375 loan amount. Monthly P&I is $1,723, plus $275 property tax, $100 insurance, and $122 PMI = $2,220 total. Over 30 years, they will pay $354,905 in interest. PMI can be removed after reaching 20% equity through payments and appreciation.
Move-Up Buyer with 20% Down
Result: Total Monthly Payment: $3,178
With 20% down payment, this buyer avoids PMI entirely, saving $100-200/month. The $400,000 loan at 6.5% results in $2,528 monthly P&I, plus $500 tax and $150 insurance = $3,178 total. Total interest over 30 years is $509,846. The 20% down payment immediately provides equity cushion and better loan terms.
Accelerated Payoff with 15-Year Loan
Result: Total Monthly Payment: $3,224
Choosing a 15-year term over 30-year increases monthly P&I from $1,919 to $2,699 (40% higher), but saves $343,908 in interest over the loan life. Total interest paid is only $165,838 vs $509,746 on a 30-year. This buyer owns their home outright 15 years sooner and builds equity much faster.
Expert Tips & Strategies
Shop for the Best Interest Rate
Get quotes from at least 3-5 lenders including banks, credit unions, and online lenders. A 0.5% rate difference on a $300,000 loan saves you about $100/month and $36,000 over 30 years.
Improve Your Credit Score Before Applying
Raising your credit score from 680 to 740+ can lower your rate by 0.5-1%, saving tens of thousands. Pay down credit cards, fix errors on your report, and avoid new credit inquiries for 6 months before applying.
Save for a Larger Down Payment
Every extra dollar down reduces your loan amount, monthly payment, and total interest. Plus, 20% down eliminates PMI, potentially saving $100-300/month depending on loan size.
Consider Shorter Loan Terms if Affordable
A 15-year mortgage typically has rates 0.5-0.75% lower than 30-year loans and saves enormous amounts in interest. If you can afford 25-30% higher payments, the savings are dramatic.
Factor in All Costs, Not Just P&I
Your total housing cost includes taxes, insurance, PMI, HOA, maintenance (1% of home value/year), and utilities. Budget for the complete picture to avoid being house-poor.
Lock Your Rate When Rates Are Favorable
Once approved, you can lock your rate for 30-60 days. If rates are rising, lock immediately. If falling, you might wait, but understand the risk. Some lenders offer float-down options.
Make Extra Principal Payments When Possible
Even small extra payments dramatically reduce interest and loan term. Adding $100-200/month to a $300,000 mortgage can save $50,000+ in interest and shave 3-5 years off the loan.
Refinance When Rates Drop Significantly
If rates fall 0.75-1% below your current rate and you plan to stay 3+ years, refinancing can save hundreds monthly. But factor in closing costs (2-5% of loan) when calculating the break-even point.
Common Mistakes to Avoid
Only Looking at Monthly Payment
Many buyers focus solely on whether they can afford the monthly payment without considering total interest paid over the loan term. A slightly higher monthly payment on a 20-year loan might save you $150,000 compared to a 30-year loan.
✓ Better approach: Always compare total cost of different loan terms, not just monthly payment. Calculate total interest paid and consider your long-term financial goals.
Maxing Out Your Budget
Just because you qualify for a certain amount doesn't mean you should borrow it. Lenders approve based on ratios, not your actual lifestyle, emergency needs, or other goals.
✓ Better approach: Leave room for emergencies, maintenance (1% of home value annually), and lifestyle expenses. Aim for housing costs under 28% of gross income, ideally 25% or less.
Ignoring Property Taxes and Insurance
Focusing only on principal and interest while overlooking property taxes and insurance can leave you unprepared. These can add $400-800/month or more to your payment.
✓ Better approach: Research actual tax rates and insurance costs for your target area and property before making offers. Remember that taxes often increase over time as property values rise.
Putting Down Less Than 20% Without Considering PMI
While low down payment loans are attractive, PMI adds $50-300+/month depending on loan size and down payment percentage. This is money that builds no equity.
✓ Better approach: Calculate whether saving up more for a larger down payment might be worth the delay. Compare total costs with and without PMI over the first 5-10 years.
Not Shopping Around for Lenders
Many buyers go with the first lender they contact or their bank without comparing. Mortgage rates and fees vary significantly between lenders.
✓ Better approach: Get quotes from at least 3-5 lenders including banks, credit unions, and online lenders. This takes a few hours but can save $50-200/month. Use a mortgage broker to access multiple lenders easily.
Choosing an ARM Without Understanding the Risks
Adjustable-rate mortgages offer attractive lower initial rates but can increase significantly after the fixed period (typically 5-7 years), potentially adding hundreds to your monthly payment.
✓ Better approach: Only choose ARMs if you're certain you'll move or refinance before the adjustment period, or if you can comfortably afford significantly higher payments after adjustment.
Forgetting About Closing Costs
Many first-time buyers save for down payment but forget closing costs, which typically run 2-5% of the home price ($6,000-15,000 on a $300,000 home).
✓ Better approach: Budget for closing costs in addition to your down payment. Options include saving more, negotiating seller credits to cover costs, or choosing a slightly higher interest rate to cover them (lender credits).
Learn More
First-Time Home Buyer's Complete Guide
Everything you need to know about buying your first home, from credit preparation to closing day.
💰Complete Budgeting Guide
Master your finances with proven budgeting methods to save for a down payment and manage homeownership costs.
📈Credit Score Improvement Guide
Boost your credit score to qualify for the best mortgage rates and save thousands in interest.
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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 principal and interest (P&I), which is then added to property taxes, insurance, PMI (if applicable), and HOA fees to get your total monthly payment.
What is PMI and when do I need it?
PMI (Private Mortgage Insurance) is typically required when your down payment is less than 20% of the home price. It protects the lender if you default on the loan. Once you reach 20% equity, you can usually request to have PMI removed.
Should I choose a 15-year or 30-year mortgage?
A 15-year mortgage has higher monthly payments but significantly lower total interest paid. A 30-year mortgage has lower monthly payments but higher total interest. Choose based on your budget and financial goals.
How much down payment should I make?
While 20% is traditional and avoids PMI, many loans allow as little as 3-5% down. A larger down payment reduces your loan amount, monthly payment, and total interest paid, but consider keeping emergency savings.
What is included in my total monthly payment?
Your total monthly payment typically includes: Principal & Interest (P&I), Property Taxes, Homeowners Insurance, PMI (if applicable), and HOA fees (if applicable). This is often called PITI or PITIA.
Can I deduct mortgage interest on my taxes?
Yes, mortgage interest is tax-deductible for most homeowners. You can deduct interest paid on mortgages up to $750,000 (or $1 million for loans taken before December 2017) if you itemize deductions. This can result in significant tax savings, especially in the early years of your mortgage when interest makes up a larger portion of your payment.
What credit score do I need to get a mortgage?
Minimum credit scores vary by loan type: FHA loans require 580+, conventional loans typically need 620+, and VA loans may accept 580-620+. However, higher credit scores (740+) qualify for the best interest rates, potentially saving you tens of thousands over the loan term.
How does my interest rate affect my payment?
Interest rate has a significant impact on your monthly payment and total cost. For example, on a $300,000 30-year loan, a 6% rate means $1,799/month while 7% means $1,996/month - a difference of $197/month or $70,920 over 30 years.
What is an amortization schedule?
An amortization schedule shows how each payment is split between principal and interest over the life of your loan. Early payments go mostly toward interest, while later payments pay down more principal. Understanding this helps you see the benefit of making extra payments to reduce interest.
Should I pay points to lower my interest rate?
Mortgage points (1 point = 1% of loan amount) can lower your interest rate by about 0.25% per point. This makes sense if you plan to stay in the home long enough to recoup the upfront cost through lower monthly payments - typically 5-7 years or more.
What happens if I make extra payments?
Extra payments go directly toward your principal balance, reducing the total interest you pay and shortening your loan term. For example, adding just $100/month to a $300,000 30-year mortgage at 6.5% saves over $60,000 in interest and pays off the loan 4 years early.
How much should I budget for property taxes?
Property taxes vary widely by location, typically ranging from 0.5% to 2.5% of home value annually. States like New Jersey average 2.21% while Hawaii averages 0.31%. Check your local tax rates and remember that taxes often increase over time as property values rise.
What type of homeowners insurance do I need?
Your lender requires homeowners insurance (HO-3 policy) covering at least the loan amount. This protects against damage, theft, and liability. Costs average $1,200-$2,000/year nationally but vary based on location, home value, coverage amount, and deductible chosen.
Is it better to pay off my mortgage early or invest?
This depends on your mortgage interest rate vs. expected investment returns. If your rate is above 6-7%, paying extra may make sense. If below 4%, investing the extra money could yield better returns. Also consider your risk tolerance, other debts, and emergency fund status before deciding.
How do I know if I can afford a mortgage?
Use the 28/36 rule: your mortgage payment (PITI) should not exceed 28% of gross monthly income, and total debt payments should stay under 36%. Additionally, ensure you have 3-6 months expenses saved as an emergency fund and can comfortably afford maintenance, utilities, and other homeownership costs.
Financial Disclaimer
This calculator is provided for educational and informational purposes only. The results are estimates based on the information you provide and should not be considered as financial, legal, or tax advice.
Actual results may vary based on your specific circumstances, market conditions, and other factors. Always consult with qualified financial, legal, and tax professionals before making any financial decisions.
We make no guarantees about the accuracy, completeness, or reliability of the calculations. Use this tool at your own risk.