Mortgage Payment Calculator

Your base monthly payment (principal & interest) is calculated using the standard amortization formula: M = P[r(1+r)^n] / [(1+r)^n - 1], where P is the loan amount, r is the monthly interest rate, and n is the total number of payments. Your total monthly payment also includes property taxes, home insurance, PMI (if applicable), and HOA fees.

PMI stands for Private Mortgage Insurance. Lenders typically require it when your down payment is less than 20% of the home's purchase price. PMI protects the lender if you default on the loan. Once you've built up 20% equity in your home, you can usually request to have PMI removed.

A 30-year mortgage has lower monthly payments but you pay significantly more interest over the life of the loan. A 15-year mortgage has higher monthly payments but you build equity faster and pay far less total interest. For example, on a $320,000 loan at 6.5%, a 30-year term costs roughly $390,000 in interest while a 15-year term costs about $160,000 in interest.

A larger down payment reduces your loan amount, which lowers your monthly payment and the total interest you pay. Putting down 20% or more also eliminates the need for PMI, saving you even more. If you can't afford 20% down, many programs allow as little as 3–3.5% down, though you'll pay PMI until you reach 20% equity.

An amortization schedule breaks down each monthly payment into the portion that goes toward principal (reducing your loan balance) and the portion that goes toward interest. In the early years, most of your payment is interest. Over time, the principal portion grows. The schedule shows your exact remaining balance after every payment.

A fixed-rate mortgage locks in your interest rate for the entire loan term, giving you predictable payments. An adjustable-rate mortgage (ARM) typically starts with a lower rate that can change periodically based on market conditions. Fixed-rate mortgages are better if you plan to stay in your home long-term; ARMs can be beneficial if you expect to sell or refinance within a few years.

You can pay off your mortgage faster by making extra principal payments, switching to bi-weekly payments (which results in one extra full payment per year), refinancing to a shorter term, or making a lump-sum payment. Even a small additional monthly payment can shave years off your loan and save tens of thousands in interest.

Beyond principal and interest, you should budget for property taxes, homeowner's insurance, HOA fees, and PMI if your down payment is under 20%. You should also set aside funds for maintenance and repairs (typically 1–2% of the home's value per year), as well as closing costs when you first purchase (usually 2–5% of the loan amount).