🏠 Mortgage Calculator
Calculate your monthly mortgage payment including taxes and insurance
Total Cost Over Loan Term
How to Use This Calculator
- Enter the home price – the total purchase price of the property
- Input your down payment amount (typically 10-20% of home price)
- Enter the interest rate you expect to receive (as annual percentage)
- Select the loan term – typically 15 or 30 years
- Add annual property tax and homeowners insurance for complete picture
- View your total monthly payment and breakdown of principal, interest, taxes, and insurance (PITI)
Understanding Mortgage Payments
What is PITI?
PITI stands for Principal, Interest, Taxes, and Insurance – the four components of your monthly mortgage payment. Principal is the amount you borrowed. Interest is what the lender charges for the loan. Taxes are property taxes paid to your local government. Insurance protects the home. Lenders use PITI to determine if you can afford the mortgage.
How Mortgage Amortization Works
Early in your mortgage, most of your monthly payment goes toward interest. Over time, more goes toward principal. This is called amortization. For example, on a $240,000 loan at 6.5% for 30 years: your first payment might be $283 principal and $1,300 interest. By year 15, it's closer to $700 principal and $900 interest. By the final payment, nearly all goes to principal.
The Impact of Down Payment
A larger down payment reduces your loan amount, monthly payment, and total interest paid. It may also help you avoid PMI (private mortgage insurance) if you put down 20% or more. For a $300,000 home: 10% down ($30,000) means borrowing $270,000 vs. 20% down ($60,000) borrowing $240,000 – saving about $190/month and $68,000 in interest over 30 years at 6.5%.
15-Year vs 30-Year Mortgages
15-year mortgages have higher monthly payments but dramatically lower total interest. For a $240,000 loan at 6.0%: a 30-year mortgage costs $1,439/month and $278,040 total interest, while a 15-year costs $2,024/month but only $124,320 total interest – saving $153,720! The trade-off is affordability: 15-year payments are 40% higher monthly but you own your home faster and save tremendously on interest.
Frequently Asked Questions
How is a monthly mortgage payment calculated?
Monthly mortgage payment is calculated using the formula M = P[r(1+r)^n]/[(1+r)^n-1], where M is monthly payment, P is principal (loan amount), r is monthly interest rate (annual rate / 12), and n is number of payments (years × 12). Additional costs like property taxes and insurance are added to get total monthly payment.
What is included in a mortgage payment?
A typical mortgage payment includes Principal (loan repayment), Interest (cost of borrowing), Taxes (property taxes), and Insurance (homeowners insurance), commonly called PITI. Some mortgages also include PMI (private mortgage insurance) if down payment is less than 20%.
How much down payment do I need?
Conventional loans typically require 10-20% down payment. FHA loans may allow as little as 3.5% down. A 20% down payment avoids PMI and often secures better interest rates. Larger down payments reduce monthly payments and total interest paid.
Should I choose a 15-year or 30-year mortgage?
30-year mortgages have lower monthly payments but higher total interest. 15-year mortgages have higher payments but you pay off the home faster and save significantly on interest. Choose based on your budget, income stability, and financial goals. Many homeowners prefer 30-year flexibility even if they can afford 15-year payments.
What's a good interest rate?
Mortgage rates fluctuate based on economic conditions, your credit score, down payment, and loan type. As of 2024, rates typically range from 6-8% for conventional mortgages. Check current market rates and shop multiple lenders. Even a 0.5% rate difference can save tens of thousands over the loan term.
Is this tool free to use?
Yes! This mortgage calculator is completely free with no hidden costs, subscriptions, or limitations. Use it to plan your home purchase and compare different scenarios.
Is my data private?
Absolutely. All calculations are performed locally in your browser. Your financial information never leaves your device and is not stored on any server.