Mortgage Calculator
Calculate your monthly mortgage payment including principal, interest, taxes, and insurance. See total cost and amortization schedule.
Reviewed by the Calcura editorial team · Last reviewed
- Question
- How do I calculate a monthly mortgage payment?
- Answer
- The monthly principal-and-interest payment on a fixed-rate mortgage is M = P × [r(1+r)ⁿ] / [(1+r)ⁿ − 1], where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of payments (years × 12). Add property tax, homeowners insurance, HOA dues, and PMI to get the full monthly housing cost (PITI).
▸Show formula & caveatsHide formula & caveats
- Formula
M = P × [r(1+r)ⁿ] / [(1+r)ⁿ − 1]- Caveats
- Covers principal and interest only — property tax, insurance, HOA, and PMI are separate.
- Assumes a fixed interest rate. ARM loans recalculate after the initial fixed period.
- Rounding: lenders quote monthly payments to the cent; estimates may differ by a few dollars.
What This Calculator Does
This calculator returns the monthly principal-and-interest (P&I) payment on a fixed-rate mortgage and the total interest paid over the full loan term. Enter home price, down payment, annual interest rate, and loan term in years; it computes the loan amount, applies the standard amortization formula used by U.S. lenders, and shows the figures you can compare against a lender's Loan Estimate. The output covers P&I only — property taxes, homeowners insurance, HOA dues, and PMI are real monthly costs that should be added separately.
When To Use This Calculator
House Hunting Within Budget
You're pre-approved for a $400,000 mortgage but want to see what monthly payments look like at different home prices. Calculate payments for homes at $350k, $400k, and $450k to understand your comfort zone before making offers.
Comparing Down Payment Options
You have $50,000 saved but could potentially stretch to $70,000 for a down payment. Calculate both scenarios to see how the extra $20,000 down affects your monthly payment, total interest, and whether you'll need PMI.
Deciding Between Loan Terms
You're torn between a 15-year and 30-year mortgage. Use this calculator to see the monthly payment difference and total interest savings. On a $300,000 loan at 7%, a 15-year mortgage saves you $230,000 in interest but costs $701 more per month.
Refinance Evaluation
Current mortgage rates are lower than when you bought your home. Calculate your new monthly payment at today's rates to determine if refinancing makes financial sense after factoring in closing costs.
How It Works
This calculator uses the standard mortgage amortization formula mandated by the Consumer Financial Protection Bureau. First, it subtracts your down payment from the home price to get your loan amount (principal). Then it applies the monthly interest rate (annual rate divided by 12) and number of payments (years times 12) to calculate a fixed monthly payment that fully pays off the loan by the final payment. The formula ensures that each payment is the same amount, with early payments primarily covering interest and later payments primarily covering principal. This is the exact calculation method banks use—your results here match what lenders will offer.
Formula
M = P[r(1+r)^n]/[(1+r)^n-1] where M = monthly payment, P = principal (home price - down payment), r = monthly interest rate, n = number of monthly paymentsReal-World Example
Scenario
Marcus and Jennifer are buying a $425,000 home in Austin. They have $85,000 saved for a down payment (20%) and are comparing two mortgage offers: 6.75% for 30 years versus 6.5% for 30 years from a different lender.
Calculation
Loan amount: $425,000 - $85,000 = $340,000 Option 1 (6.75%): $2,204/month • Total interest: $453,530 Option 2 (6.5%): $2,148/month • Total interest: $433,187
Result
By choosing the lender with 0.25% lower rate, they save $56 per month and $20,343 in total interest over 30 years. This calculation helped them negotiate with their preferred lender to match the better rate.
Common Mistakes to Avoid
Mistake: Forgetting property taxes and insurance in your budget
Solution: This calculator shows principal and interest only. Add $200-500/month for property taxes and $100-200/month for homeowners insurance to get your true monthly housing cost. Use the 28% rule: total housing costs should not exceed 28% of gross monthly income.
Mistake: Not accounting for PMI on down payments under 20%
Solution: If your down payment is less than 20%, add 0.5-1% of the loan amount annually for PMI. On a $300,000 loan, that's $125-250/month until you reach 20% equity. This significantly increases your monthly cost.
Mistake: Comparing monthly payment without checking total interest
Solution: A 30-year mortgage has a lower monthly payment than 15-year, but you'll pay 2-3x more in total interest. Always check both numbers. On a $300,000 loan at 7%, the 30-year costs $418,527 in interest vs. $185,329 for 15-year.
Mistake: Assuming the first rate you're quoted is the best available
Solution: Interest rates vary by lender. Getting quotes from 3-5 lenders can reveal rate differences of 0.25-0.5%, which translates to thousands in savings. Even 0.125% difference on a $400,000 loan saves $10,000+ over 30 years.
Mortgage Calculator vs. Related Tools
Mortgage Affordability Calculator
Use this FIRST to determine how much house you can afford based on your income and debts. Then use the mortgage calculator to fine-tune payments for homes in your range.
Loan Amortization Calculator
After calculating your monthly payment, use this to see your complete payment schedule year-by-year, showing exactly how much of each payment goes to principal vs. interest.
Loan Payment Calculator
Similar to mortgage calculator but simpler—doesn't include down payment. Use this for other loans (auto, personal) where you're comparing loan amounts directly.
When This Isn't the Right Tool
Adjustable-rate mortgages (ARMs)
Use instead: ARMs start with a fixed period, then reset based on an index. A single-rate projection understates the risk. Review the specific ARM's index, margin, and caps, and run worst-case reset scenarios rather than relying on the starting rate.
Total-cost-of-ownership planning
Use instead: This calculator shows P&I only. Add property tax (often 0.5–2.5% of home value per year depending on state), homeowners insurance, HOA dues, PMI if down payment is under 20%, and ongoing maintenance to see your true monthly outlay.
Qualifying for a specific loan program
Use instead: FHA, VA, USDA, and jumbo loans have separate eligibility rules and sometimes different pricing. A CFPB or HUD-certified housing counselor can walk you through program requirements before you commit.
How to Verify This Calculation
Cross-check the monthly payment against the Consumer Financial Protection Bureau's consumer-facing rate-check tool or any lender's official pre-qualification calculator. In a spreadsheet: =PMT(rate/12, years*12, -(price-down)) returns the same P&I payment. On a lender's Loan Estimate, compare against the Projected Payments section — P&I should match within a few cents of rounding.
Sources
- Consumer Financial Protection Bureau — Explore interest rates — Official CFPB tool showing typical rates by credit score and loan type, useful for sanity-checking a quoted rate.
- CFPB — Loan Estimate explainer — What each line on your Loan Estimate means; the document you should actually compare to these calculator outputs.
- U.S. Department of Housing and Urban Development (HUD) — Primary source for FHA, HUD counseling, and federal mortgage program eligibility.
- Freddie Mac Primary Mortgage Market Survey (PMMS) — Weekly average U.S. mortgage rate series — useful reference for "what rates look like right now."
Reviewed by the Calcura editorial team · Last reviewed