Mortgage Payment Calculator

Most lenders quote a monthly payment as PITI: principal, interest, taxes and insurance. The principal-and-interest portion comes from the standard amortization formula: M = P × i(1+i)ⁿ ÷ ((1+i)ⁿ − 1), where P is the loan amount, i is the annual rate divided by 12, and n is the number of monthly payments. This payment stays the same for the life of a fixed-rate loan, but the split shifts over time: early payments are mostly interest, later payments are mostly principal.

Property tax and homeowners insurance are usually collected by your servicer into an escrow account, so they are added to the payment even though they are not part of the loan. If your down payment is less than 20% on a conventional loan, lenders typically require private mortgage insurance (PMI). PMI is commonly priced between about 0.3% and 1.5% of the loan amount per year depending on credit score and down payment, and it can usually be removed once you reach 20% equity. HOA dues are paid separately, but they are a real monthly housing cost, so the calculator includes them in the total.

Rate and price dominate. On a $320,000 loan, every 1 percentage point of interest changes the payment by roughly $200 a month. Term matters too: a 15-year loan has a much higher monthly payment than a 30-year loan, but it typically carries a lower rate and can cut total interest by more than half. A bigger down payment lowers the loan amount, can remove PMI entirely, and sometimes earns a better rate.

A common affordability guideline is that total housing costs should stay under roughly 28% of gross monthly income, and total debt payments under about 36%. Lenders may approve more than that, but the approval amount is not the same as a comfortable payment. Use the calculator to test a payment you would still be fine with if income dipped or other costs rose.

Say you buy a $400,000 home with 20% down ($80,000) at a 6.5% rate on a 30-year fixed loan. The loan is $320,000, so i = 0.065 ÷ 12 ≈ 0.005417 and n = 360. Principal and interest come to about $2,022.62 per month. Add $4,800/yr property tax ($400/mo) and $1,800/yr insurance ($150/mo) and the full payment is about $2,573. Because the down payment is 20%, no PMI is charged. Over 30 years you would pay roughly $408,000 in interest — more than the loan itself — which is why extra principal payments early in the loan are so powerful.

Drop the down payment to 10% and the loan rises to $360,000, P&I rises to about $2,275, and PMI at 0.5% adds another $150 a month — roughly $400 more per month than the 20%-down scenario.