Mortgage Payment Calculator

How a mortgage payment really works

The price on the listing tells you almost nothing about what you'll pay each month. Your real payment is PITI — principal, interest, taxes, and insurance — and for most buyers it also includes PMI and sometimes HOA dues. This calculator builds all of it so you see the true number before you fall in love with a house you can't comfortably afford.

The principal and interest piece is a standard amortized loan: your loan amount (home price minus down payment) is spread across the term in equal monthly payments at your fixed monthly rate (annual rate ÷ 12). Early payments are mostly interest; later ones are mostly principal. On top of that, your lender collects property tax and homeowners insurance into an escrow account and pays those bills for you, so they're folded into the monthly figure.

PMI — the cost of putting less down

If your down payment is under 20%, the lender charges private mortgage insurance to protect itself if you default. It's added to your payment every month — and it's pure cost to you, buying you nothing. The good news is it isn't permanent: once you reach 20% equity, you can request that it be removed, and it must be cancelled automatically at 22% equity. The calculator only adds PMI when your down payment is below 20%, and the PMI field disappears entirely once you cross that line.

15-year versus 30-year

The term you choose is the single biggest lever on lifetime cost. A 30-year loan gives you a lower, more comfortable monthly payment, which is why most buyers take it. But you pay interest for twice as long — on a typical loan a 15-year term can save well over a hundred thousand dollars in total interest, while building equity far faster. The trade-off is a noticeably higher monthly payment. Flip the term above and watch the "total interest" line move.

Common mistakes

• Budgeting from principal and interest alone. Taxes, insurance, and PMI can add hundreds a month. Always budget the full PITI.
• Forgetting PMI when you put little down. A small down payment lowers your upfront cash but adds a monthly charge until you reach 20% equity.
• Ignoring property tax differences. Two identical houses in different counties can have very different tax bills — it's a percent of value, every year, forever.
• Stretching past the 28% rule. Keeping PITI under about 28% of gross income leaves room for maintenance, repairs, and the rest of your life.

When this calculator is the wrong tool

This estimates a standard fixed-rate mortgage with an escrow estimate. It doesn't model adjustable-rate loans, interest-only or balloon structures, points paid at closing, or the exact tax and insurance figures for your specific property — those vary widely by county and insurer. It's a planning tool, not financial advice — confirm every number with your lender and a loan estimate.