Mortgage Calculator
Calculate your monthly mortgage payment including principal, interest, taxes, insurance, and PMI.
Results
Visualization
How It Works
The Mortgage Calculator helps you determine your complete monthly housing payment by combining principal and interest with property taxes, homeowners insurance, and PMI (private mortgage insurance). Understanding your true monthly mortgage cost—not just the loan payment—is essential for budgeting and determining how much home you can actually afford. This tool is designed for both quick estimates and detailed planning scenarios. Results update instantly as you adjust inputs, making it easy to compare different approaches and understand how each variable affects the outcome. For best accuracy, use precise measurements rather than rough estimates, and consider running multiple scenarios to establish a realistic range of expected results.
The Formula
Variables
- Home Price — The total purchase price of the property you're buying, which minus your down payment equals your loan amount
- Down Payment (%) — The percentage of the home price you're paying upfront in cash; a larger down payment reduces your loan amount and may eliminate PMI
- Loan Term — The number of years you have to repay the mortgage, typically 15, 20, or 30 years; longer terms mean lower monthly payments but higher total interest
- Interest Rate (%) — Your annual mortgage interest rate, which depends on market conditions, credit score, and loan type; this is the cost of borrowing the money
- Annual Property Tax & Insurance — Yearly costs for local property taxes and homeowners insurance that are typically rolled into your monthly mortgage payment
- PMI Rate — Private mortgage insurance cost as a percentage of your loan amount per year, required when your down payment is less than 20%
Worked Example
Let's say you're buying a $350,000 home with a 10% down payment ($35,000), leaving you with a $315,000 loan. You lock in a 6.5% interest rate on a 30-year mortgage. Your annual property taxes are $4,200, annual homeowners insurance is $1,200, and because your down payment is only 10%, your PMI rate is 0.8% annually. First, calculate the principal and interest: on a $315,000 loan at 6.5% over 30 years, your monthly P&I payment is approximately $2,000. Then add the monthly components: property tax is $4,200 ÷ 12 = $350/month, insurance is $1,200 ÷ 12 = $100/month, and PMI is ($315,000 × 0.008) ÷ 12 = $210/month. Your total monthly payment comes to $2,000 + $350 + $100 + $210 = $2,660. Over the 30-year loan life, you'll pay approximately $957,600 total, meaning you'll pay roughly $642,600 in interest alone.
Practical Tips
- Increase your down payment to at least 20% if possible to eliminate PMI entirely, which can save you $150–$300+ per month depending on your loan amount and lender requirements
- Compare different loan terms: a 15-year mortgage costs more monthly but saves significantly on interest ($200,000+ on a typical loan), while a 30-year spreads payments lower but costs substantially more overall
- Don't forget to factor in closing costs (typically 2–5% of the home price) which you'll need upfront; this calculator shows ongoing payments but you'll also need cash for appraisals, inspections, and fees at closing
- Use this calculator to test different interest rate scenarios, as even a 0.5% difference in rate changes your monthly payment by $150–$200 on a typical loan, making it worth shopping around with multiple lenders
- Remember that property taxes and insurance costs increase over time, so your actual payment 10 years from now will be higher than the amount shown; budget for approximately 3% annual increases in these costs
Frequently Asked Questions
What is PMI and when do I have to pay it?
Private Mortgage Insurance protects the lender if you default on your loan. Most lenders require PMI when your down payment is less than 20% of the home price. PMI typically ranges from 0.5% to 2% of your loan amount annually, depending on your credit score and down payment percentage. Once you've paid down your principal to 80% of the original home value, you can request PMI removal.
Why is my actual mortgage payment higher than just the principal and interest?
Your mortgage payment includes four main components: principal and interest (which builds equity), property taxes (paid to your local government), homeowners insurance (protects your home), and potentially PMI (if your down payment was less than 20%). Lenders typically collect these through an escrow account and pay them on your behalf, rolling everything into one monthly payment called PITI or PITI+PMI.
How much should I spend on a house based on mortgage payments?
Financial experts generally recommend that your total housing payment (mortgage, taxes, insurance, PMI) should not exceed 28% of your gross monthly income. For example, if you earn $6,000 per month before taxes, your housing payment should stay under $1,680. This ensures you have enough income left for other expenses, savings, and debt payments.
What's the difference between a 15-year and 30-year mortgage?
A 15-year mortgage has higher monthly payments but you pay off the house twice as fast and pay significantly less total interest—often $200,000+ less over the life of the loan. A 30-year mortgage has lower monthly payments, making homeownership more affordable month-to-month, but you pay substantially more in interest. Choose based on whether you prioritize lower monthly payments (30-year) or building equity faster and paying less interest (15-year).
Can I pay off my mortgage early without penalty?
Most conventional mortgages allow you to pay extra principal any time without penalty, which can shorten your loan by years and save thousands in interest. However, some loans (particularly FHA loans) may have prepayment restrictions, and adjustable-rate mortgages sometimes include penalties. Always check your loan documents, and consider putting extra payments toward principal rather than making a larger monthly payment, so you maintain payment flexibility.
Sources
- Consumer Financial Protection Bureau: Mortgage Payment Calculator and Guide
- Federal Reserve: How Mortgage Interest Rates Are Determined
- HUD.gov: Private Mortgage Insurance Information
- IRS Publication 936: Home Mortgage Interest Deduction
- Fannie Mae: Understanding Your Mortgage Payment Components