Finance · Mortgage
Mortgage Calculator
Estimate your full monthly mortgage payment — principal, interest, PMI, property tax and home insurance — for any home price and down payment. Free and no sign-up.
How the mortgage calculator works
Your total monthly housing payment is built from four parts, often called PITI — Principal, Interest, Taxes and Insurance — plus PMI if your down payment is small:
- Principal & Interest (P&I) — the core loan repayment, calculated with the standard fixed-rate amortization formula.
- Property tax — the home price times your local tax rate, divided by 12.
- Home insurance — your annual premium divided by 12.
- PMI — added only when your down payment is under 20%, estimated at 0.5% of the loan per year.
The principal-and-interest portion uses this amortization formula:
M = P · r · (1 + r)n ÷ ((1 + r)n − 1)
where P is the loan amount (home price minus down payment), r is the monthly interest rate (annual rate ÷ 100 ÷ 12), and n is the number of monthly payments (term in years × 12). If the rate is 0%, the payment is simply the loan amount divided by the number of payments.
Example
On a $400,000 home with 20% down ($320,000 loan) at 6.5% over 30 years, the principal and interest comes to about $2,022 per month. With 20% down there is no PMI; property tax and insurance are added on top to get your full payment.
Things to keep in mind
This estimate excludes some costs
The result does not include HOA or condo dues, mortgage points, closing costs, or future changes in your tax assessment and insurance premium. Property tax and insurance often rise over the years, so your real payment can drift upward even with a fixed-rate loan.
PMI can be removed later
PMI is not permanent. Once you build roughly 20% equity — through payments or rising home value — you can usually request to cancel it, which lowers your monthly payment. A larger down payment avoids PMI from day one.
Frequently asked questions
What is included in my monthly mortgage payment?
A typical US payment is PITI: principal and interest, property tax and home insurance — plus PMI if your down payment is under 20%. This calculator adds all four so you see the true monthly cost.
What is PMI and when do I pay it?
Private Mortgage Insurance protects the lender. On a conventional loan you generally pay it when your down payment is below 20%, estimated here at about 0.5% of the loan per year. You can usually cancel PMI once you reach ~20% equity.
How much should I put down on a house?
20% avoids PMI and lowers your payment, but isn't required. Many buyers put down 3–10%. A bigger down payment means a smaller loan and less total interest, but ties up more cash up front.
How is the property tax estimated?
It's the home value times your local tax rate, divided by 12. The national average is roughly 1.1%/yr but ranges from under 0.4% to over 2% by state. Adjust the rate to your local figure for accuracy.
Is this calculator accurate?
It's a close estimate using a standard amortization formula. It excludes HOA dues, points and closing costs. For an exact figure, request a Loan Estimate from a lender within three business days of applying.
Fixed-rate vs. adjustable-rate mortgages
This calculator assumes a fixed-rate mortgage, where your interest rate and principal-and-interest payment stay the same for the entire term. Fixed rates are the most common choice in the United States precisely because the payment is predictable: a 30-year fixed loan you take out today will have the same principal-and-interest amount in year 1 and year 29.
An adjustable-rate mortgage (ARM) works differently. It usually starts with a lower fixed rate for an introductory period — often shown as 5/1, 7/1 or 10/1, where the first number is how many years the rate is locked and the second is how often it can change afterward. After that period, the rate adjusts up or down with a market index, so your payment can rise. ARMs can make sense if you expect to sell or refinance before the fixed period ends, but they carry the risk of higher payments later. Because the payment changes over time, an ARM cannot be modeled with a single fixed-rate formula like the one this tool uses.
15-year vs. 30-year terms
One of the biggest decisions a borrower makes is the loan term. A shorter term means a higher monthly payment but far less interest paid over the life of the loan, because you are borrowing the money for fewer years and shorter-term loans often carry a slightly lower interest rate. The table below shows how the same $320,000 loan behaves at an approximate 6.5% rate for 30 years and a roughly 5.9% rate for 15 years — shorter terms commonly price a little lower, though your actual offers will vary by lender and credit profile.
| Term | Approx. rate | Monthly P&I | Total interest |
|---|---|---|---|
| 30 years | 6.5% | ~$2,022 | ~$408,000 |
| 15 years | 5.9% | ~$2,683 | ~$163,000 |
In this illustration the 15-year loan costs about $661 more each month, but it saves roughly $245,000 in total interest and pays the house off in half the time. The 30-year loan keeps the monthly cost lower and frees up cash flow for other goals — emergency savings, retirement contributions, or simply breathing room. Neither choice is universally "right"; it depends on your income stability, other debts, and how much monthly payment you can comfortably absorb. Plug both terms into the calculator above to see the trade-off with your own numbers.
How down payment size changes everything
The size of your down payment affects your monthly payment in two compounding ways: it shrinks the amount you borrow, and once you cross the 20% threshold it removes PMI entirely. The example below holds the home price at $400,000 and a 6.5% rate over 30 years, and varies only the down payment to show the effect on principal, interest and PMI.
| Down payment | Loan amount | PMI? | Approx. P&I + PMI / mo |
|---|---|---|---|
| 5% ($20,000) | $380,000 | Yes | ~$2,560 |
| 10% ($40,000) | $360,000 | Yes | ~$2,425 |
| 20% ($80,000) | $320,000 | No | ~$2,022 |
The jump from 10% to 20% down does more than reduce the loan by $40,000 — it also drops the PMI line to zero, which is why the monthly figure falls so sharply. That does not automatically make a 20% down payment the best move. Putting more cash into the house means less cash in your emergency fund and investments, and PMI can be cancelled later once you build equity. The right balance depends on how much liquidity you want to keep.
Should you refinance?
Refinancing replaces your current mortgage with a new one, usually to lower the rate, change the term, or tap equity. The general rule of thumb people use is whether the new rate is meaningfully lower than your current one — often cited as roughly three-quarters of a percentage point or more — but the real test is your break-even point: divide the total closing costs of the new loan by the monthly savings to see how many months it takes to recoup the cost. If you plan to stay in the home longer than that break-even period, refinancing can pay off; if you might move sooner, the upfront costs may never be recovered.
Be careful when refinancing into a fresh 30-year term. A lower rate looks attractive, but if you restart the clock you may pay more total interest even at the lower rate simply because you are stretching the payments back out over three decades. You can model this by entering the new rate and the years remaining (not a full new 30) in the calculator above.
Common misconceptions
- "My monthly payment is just principal and interest." For most US homeowners the lender collects property tax and insurance in an escrow account along with the loan payment, so the real monthly cost is noticeably higher than P&I alone.
- "A pre-qualification is the same as a pre-approval." Pre-qualification is a quick, informal estimate. A pre-approval involves the lender verifying your finances and carries far more weight with sellers.
- "PMI is wasted money." PMI lets you buy sooner with less cash down. For many buyers, getting into the market years earlier outweighs the cost, and PMI ends once you reach about 20% equity.
- "The lowest rate is always the best loan." A rate quoted with points (prepaid interest) can look lower than a no-points loan. Compare the APR and the closing costs together, not the headline rate alone.
How to use the results wisely
Treat the output of this tool as a planning estimate, not a quote. A few practical habits make it far more useful:
- Check the total interest, not just the monthly payment. Two loans can have similar monthly payments but very different lifetime costs depending on the term.
- Set your local tax rate. The 1.1% national-average default is only a starting point. Property tax ranges from under 0.4% in some states to over 2% in others, which can swing your monthly payment by hundreds of dollars. Use your county assessor's figure.
- Stress-test the rate. Try a rate half a point higher than today's offers to see how sensitive your budget is before you lock in.
- Leave room in your budget. Many lenders look at whether your total monthly housing cost fits within a reasonable share of your gross income, and they also weigh your other debts. A payment you can technically qualify for is not always one you will be comfortable carrying for thirty years.
When you are ready to move forward, ask each lender for an official Loan Estimate — a standardized three-page form that breaks down the rate, monthly payment, closing costs and total cost over five years. Because every lender uses the same format, it is the cleanest way to compare offers side by side.
More questions about your mortgage
What is an escrow account?
An escrow account is held by your lender to collect property tax and homeowners insurance along with your monthly payment. The lender then pays those bills on your behalf when they come due, which is why your total payment is higher than principal and interest alone.
What are mortgage points?
Points are an optional fee you pay up front to lower your interest rate. One point typically costs 1% of the loan amount. Paying points can make sense if you keep the loan long enough to recoup the cost through the lower payment, but it ties up cash at closing.
What credit score do I need to buy a home?
Requirements vary by loan type and lender. Conventional loans generally favor higher scores for the best rates, while government-backed programs such as FHA loans are designed to accept lower scores with a larger insurance cost. A higher score usually earns a lower rate, which directly lowers your monthly payment.
What is the difference between pre-qualification and pre-approval?
Pre-qualification is a fast, informal estimate based on numbers you provide. Pre-approval is a stronger step where the lender verifies your income, assets and credit, giving you a more reliable budget and more credibility with sellers.
Can I pay off my mortgage early?
Usually yes. Making extra principal payments shortens the loan and reduces total interest. Check whether your loan has a prepayment penalty first, though most modern conventional loans do not. Even one extra payment a year can shave years off a 30-year loan.
Does the calculator include closing costs?
No. Closing costs — lender fees, title, appraisal, prepaid taxes and insurance — are paid up front and are separate from the monthly payment this tool estimates. They commonly run a few percent of the home price, so budget for them in addition to your down payment.