Monthly Payment Mortgage Calculator

The Monthly Payment Mortgage Calculator helps you calculate your mortgage payment with a complete cost breakdown, visual charts, and a full amortization schedule. Enter your home price, down payment, interest rate, and loan term to see exactly how much you will pay each month and over the life of your loan. Optionally include property tax and home insurance for a complete PITI (Principal, Interest, Taxes, Insurance) estimate.

Mortgage Payment Formula

The monthly principal and interest payment is calculated using the standard fixed-rate mortgage amortization formula:

Where:

• M = Monthly payment (principal and interest)
• P = Loan amount (home price minus down payment)
• r = Monthly interest rate (annual rate ÷ 12 ÷ 100)
• n = Total number of payments (term in years × 12)

Understanding Your Mortgage Payment

A typical mortgage payment includes four components, often called PITI:

• Principal — The portion that reduces your outstanding loan balance
• Interest — The cost of borrowing, calculated on the remaining balance
• Taxes — Annual property taxes, typically paid monthly into an escrow account
• Insurance — Homeowners insurance premium, also typically escrowed

How to Use This Calculator

1. Enter home price: Input the total price of the home, or the total loan amount if no down payment.
2. Specify down payment: Enter your planned down payment (optional). The calculator computes the loan amount automatically.
3. Set interest rate: Enter the annual interest rate offered by your lender.
4. Choose loan term: Select the mortgage term. 15-year and 30-year are the most common in the US.
5. Add tax and insurance: Optionally include annual property tax and home insurance for a full PITI breakdown.
6. Review results: Examine the monthly payment, total cost, visual charts, and amortization schedule.

15-Year vs 30-Year Mortgage

Choosing between a 15-year and 30-year mortgage is one of the most important decisions for homebuyers:

What Is an Amortization Schedule?

An amortization schedule is a complete table showing every monthly payment over the life of a loan. Each row breaks down the payment into principal and interest portions and shows the remaining balance. This schedule reveals:

• How much of each payment goes to interest vs. reducing your balance
• The crossover point where more payment goes to principal than interest
• How extra payments could accelerate your payoff
• The total interest cost at any point during the loan

Tips to Reduce Your Mortgage Cost

• Larger down payment: Putting 20% or more down avoids PMI and reduces total interest.
• Shop for rates: Even a 0.25% rate difference can save tens of thousands over the loan term.
• Shorter term: A 15-year mortgage has higher monthly payments but dramatically lower total interest.
• Extra payments: Even one extra payment per year can shave years off your mortgage.
• Refinance wisely: If rates drop significantly below your current rate, refinancing may save money long term.

How Much Should My Down Payment Be?

A conventional down payment is typically 20% of the home price, which avoids private mortgage insurance (PMI). However, many loan programs accept as little as 3-5% down. A larger down payment reduces your monthly payment, total interest paid, and loan-to-value ratio. Use this calculator to compare different down payment scenarios.

Frequently Asked Questions

How is the monthly mortgage payment calculated?

The monthly mortgage payment (principal and interest) is calculated using the standard amortization formula: M = P × r(1+r)ⁿ / ((1+r)ⁿ - 1), where P is the loan amount, r is the monthly interest rate (annual rate divided by 12), and n is the total number of monthly payments. This ensures equal monthly payments over the life of the loan.

What is included in a monthly mortgage payment?

A monthly mortgage payment typically includes four components, often called PITI: Principal (the portion that reduces your loan balance), Interest (the cost of borrowing), Taxes (property taxes, usually escrowed monthly), and Insurance (homeowners insurance, also typically escrowed). This calculator lets you include all four components for a complete picture.

What is an amortization schedule?

An amortization schedule is a complete table showing every monthly payment over the life of a loan. It breaks down each payment into principal and interest portions and shows the remaining balance. Early payments are mostly interest, while later payments are mostly principal. This schedule helps you understand how your mortgage balance decreases over time.

How much should my down payment be?

A conventional down payment is typically 20% of the home price, which avoids private mortgage insurance (PMI). However, many loan programs accept as little as 3-5% down. A larger down payment reduces your monthly payment, total interest paid, and loan-to-value ratio. Use this calculator to compare different down payment scenarios.

Is a 15-year or 30-year mortgage better?

A 15-year mortgage has higher monthly payments but significantly lower total interest cost. A 30-year mortgage offers lower monthly payments but costs more in total interest. For example, on a $300,000 loan at 6.5%, a 30-year mortgage costs about $382,633 in interest versus $163,572 for a 15-year term. Choose based on your monthly budget and financial goals.

How does the interest rate affect my monthly payment?

Even small changes in interest rate significantly impact your monthly payment and total cost. For a $300,000 30-year mortgage, each 0.5% rate increase adds roughly $90-$100 to the monthly payment and $30,000-$35,000 in total interest over the loan life. Shopping for the best rate can save you tens of thousands of dollars.

Additional Resources

• Mortgage Calculator - Wikipedia
• Amortization Schedule - Wikipedia