Use the Mortgage Calculator
Estimate a mortgage payment with principal, interest, property tax, home insurance, and total borrowing cost.
Start with the financed principal
The financed principal is normally the home price minus the down payment. A $350,000 purchase with $70,000 paid upfront leaves a $280,000 loan principal, before any fees added to the loan.
A larger down payment lowers principal. It may also change lender pricing or mortgage-insurance requirements, but those rules are outside the standard payment formula.
Use the amortization formula
For a fixed-rate mortgage, monthly principal and interest are calculated with M = P[r(1+r)^n] / [(1+r)^n−1]. P is principal, r is the monthly decimal rate, and n is the number of monthly payments.
An annual rate of 6% becomes 0.06 ÷ 12 = 0.005 per month. A 30-year term has 30 × 12 = 360 monthly payments. The formula produces an equal scheduled payment while the principal and interest shares change over time.
Add property tax and insurance
An all-in housing estimate often adds one-twelfth of annual property tax and one-twelfth of annual home insurance to the principal-and-interest payment. These amounts may be collected through escrow, billed separately, or change over time.
Other possible costs include homeowners association dues, mortgage insurance, maintenance, utilities, lender fees, and local charges. They should not be assumed unless the calculator asks for them.
Understand total interest
Total scheduled loan payments equal the principal-and-interest payment multiplied by the number of payments. Subtracting principal gives total interest if the fixed loan is held for the complete term with no extra payments.
A shorter term usually raises the monthly payment but reduces total interest. An extra principal payment can also reduce later interest, provided the lender applies it to principal and does not impose an offsetting charge.
Treat the result as an estimate
A calculator is valuable for comparing scenarios, but a lender's annual percentage rate, fee treatment, compounding convention, escrow calculation, and approval criteria may differ. Use the same assumptions when comparing options.
Before committing, review an official loan disclosure and confirm recurring housing costs. A payment that fits a simple ratio may still be uncomfortable once maintenance, savings goals, and income variability are considered.
Questions about how to calculate a mortgage payment
Does a mortgage payment stay the same for 30 years?
Principal and interest stay level on a standard fixed-rate loan, but taxes, insurance, and other costs can change.
What happens when the interest rate is zero?
Principal is divided evenly across the scheduled payments.
Why is the early payment mostly interest?
Interest is calculated on the outstanding balance, which is largest near the beginning of an amortized loan.