How this mortgage calculator works
For a fixed-rate loan with level payments, the principal-and-interest payment comes from the standard amortization formula. In the early years most of each payment goes to interest; the share that repays principal grows month after month.
Monthly property tax = home price × annual tax rate ÷ 12. Monthly insurance = annual premium ÷ 12.
The calculator also builds a year-by-year amortization table and a chart separating the principal and interest you pay each year.
How to read the results
- Total monthly payment. Principal and interest, plus the property tax and homeowners insurance you enter. Many lenders collect these through an escrow account.
- Total interest. What the loan costs you in interest over its life. A shorter term or an extra monthly payment lowers it sharply.
- Extra monthly payment. Any amount added to your payment goes straight to principal, shortening the loan. The calculator shows the interest saved and the time cut off.
What this payment leaves out
- Mortgage insurance. Private mortgage insurance usually applies when your down payment is under 20%.
- HOA dues, utilities and maintenance. They are real housing costs but not part of the loan payment.
- Closing costs. Lenders must give you a standardized Loan Estimate that lists them, so you can compare offers line by line.
To see how much house your income supports, try our home affordability calculator. To weigh a shorter term against a longer one, read 15-year vs 30-year mortgage.
Frequently asked questions
How is a mortgage payment calculated?
For a fixed-rate loan, the payment equals the loan amount times the monthly rate, divided by one minus one plus the monthly rate raised to the negative number of payments. The calculator applies this formula, then adds the monthly share of property tax and insurance.
Why is so much of my early payment interest?
Interest is charged on the balance you still owe. At the start the balance is highest, so the interest share is too. As you repay principal, the interest share shrinks, which is what the amortization table shows.
Do extra payments really save money?
Yes. Extra money goes straight to principal, which lowers the balance that interest is charged on. Over a 30-year loan even a modest monthly addition can cut years off the term. Check that your loan has no prepayment penalty first.
Which costs are not in this payment?
Private mortgage insurance, HOA dues, utilities, maintenance and closing costs are not included. Property taxes and insurance often change from year to year, so your payment can change even with a fixed rate.
How much down payment do I need?
There is no single required amount. A down payment of 20% typically avoids private mortgage insurance on a conventional loan, but many loans allow much less. Try different down payments in the calculator to see the effect on the monthly payment and total interest.
Sources
This tool is for general information and illustration. It is not personalized advice. Confirm the figures with a qualified professional. See our editorial standards.
