Mortgage Calculator
Use this mortgage calculator to estimate your monthly payment, total interest paid, and view an amortization schedule for any loan.
Monthly Payment
Total estimated monthly cost
How It Works
The monthly mortgage payment is calculated using the standard amortization formula, which factors in your principal, interest rate, and loan term. This is exactly what our mortgage calculator computes when you enter your loan details above.
Formula
M = P × [r(1+r)ⁿ] / [(1+r)ⁿ−1]
Where P = principal, r = monthly rate, n = number of payments
Amortization Preview
| Year | Principal | Interest | Balance |
|---|---|---|---|
| 1 | $3,421 | $25,758 | $396,579 |
| 2 | $3,647 | $25,532 | $392,932 |
| 5 | $4,380 | $24,799 | $379,832 |
| 10 | $5,928 | $23,251 | $351,064 |
| 20 | $10,860 | $18,319 | $260,372 |
| 30 | $22,071 | $7,108 | $0 |
What's Actually in Your Monthly Payment
The conventional 30-year fixed-rate mortgage accounts for 70–90% of all home loans in the U.S. — it's the default for good reason. Lenders and housing advisors use the acronym PITI to describe the four components of a typical mortgage payment: Principal, Interest, Taxes, and Insurance. Most people focus on the P&I — but taxes and insurance can add $500–$1,000+ per month depending on where you live. When you run numbers in a mortgage calculator, you're usually looking at just the P&I portion — but your real monthly obligation is PITI.
Principal
The portion that actually pays down your loan balance. This starts small and grows over time as your loan amortizes.
Interest
The cost of borrowing. On a 30-year, $320k loan at 6.5%, you'll pay roughly $410,000 in interest over the life of the loan — more than the original purchase price.
Taxes
Property taxes, collected monthly by your lender into an escrow account, then paid to your local government annually. Americans pay roughly 1.1% of home value per year on average — though this varies widely by state and county.
Insurance
Homeowners insurance (required by lenders) plus PMI if your down payment is below 20%.
15-Year vs. 30-Year Mortgage
| Factor | 15-Year | 30-Year |
|---|---|---|
| Monthly Payment | $2,787 | $2,023 |
| Total Interest Paid | $181,700 | $408,200 |
| Total Cost | $501,700 | $728,200 |
| Equity at Year 5 | ~$107k | ~$30k |
Based on $320k loan at 6.5% / 5.8% (15-yr rates are typically lower). Numbers are approximate.
Run your own numbers with the mortgage calculator above to compare loan terms at current rates.
The 30-year saves $764/month in cash flow — which matters if you have other high-interest debt or need flexibility.
How to Lower Your Monthly Mortgage Payment
Put Down 20%
Avoids Private Mortgage Insurance (PMI), which typically costs 0.5–1.5% of the loan annually. On a $400k loan that's $2,000–$6,000 per year gone until you hit 20% equity.
Shop Multiple Lenders
A 0.25% rate difference on a $400k loan saves roughly $17,000 in interest over 30 years. Most borrowers only get quotes from 1–2 lenders. Getting 3–5 quotes takes a few hours and is worth it. Plug each rate into the mortgage calculator to see the exact monthly and lifetime difference.
Improve Your Credit Score First
Going from a 680 to a 740 credit score can improve your rate by 0.5–0.75%. Pay down credit card balances and avoid new credit applications for 6 months before applying for a mortgage.
Consider Buying Points
Mortgage points let you pay upfront to lower your rate (1 point = 1% of loan = roughly 0.25% rate reduction). Makes sense if you plan to stay 7+ years and have the cash — run the break-even math first.
Pay Biweekly Instead of Monthly
Pay half your monthly payment every two weeks instead of one full payment monthly. Since there are 52 weeks in a year, this results in 26 half-payments — the equivalent of 13 full monthly payments. That extra payment typically shaves 4–5 years off a 30-year mortgage and saves tens of thousands in interest.
A Brief History of the American Mortgage
Before the 1930s, getting a home loan meant putting down 50% upfront and paying off the rest in 3–5 years. Homeownership was a privilege of the wealthy. Then the Federal Housing Administration and Fannie Mae introduced the 30-year fixed mortgage — and suddenly millions of Americans could own a home. That single financial innovation is arguably what built the American middle class. The mortgage calculator you're using today is built on a financing structure that's less than 100 years old.
Frequently Asked Questions
Disclaimer: This mortgage calculator provides estimates for educational purposes only. Actual loan terms, interest rates, and payment amounts will vary based on your lender, credit history, property location, and market conditions. Property tax and insurance estimates are approximations. Consult a licensed mortgage professional before making homebuying decisions.
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