Mortgage Calculator
This mortgage calculator helps you estimate your monthly home loan payment before you commit to a property. Enter the home price, down payment, loan term, and interest rate to see a breakdown of principal and interest, property tax, insurance, and HOA costs. It is useful for comparing loan options and understanding the true monthly cost of homeownership.
Quick answer
Monthly payment includes principal, interest, and any taxes, insurance, or HOA you entered.
What this tells you
- •Monthly payment includes principal, interest, and any taxes, insurance, or HOA you entered.
- •Principal and interest is the core loan cost. Taxes and insurance are added on top.
- •Total interest shows how much you pay the lender beyond the original loan amount over the full term.
How to Use
- 1Enter the home price you are considering.
- 2Add your expected down payment amount.
- 3Set the loan term in years. Common terms are 15 or 30 years.
- 4Enter the annual interest rate offered by the lender.
- 5Optionally add yearly property tax, yearly home insurance, and monthly HOA.
- 6Review the estimated monthly payment and full cost breakdown.
How It Works
Formula
M = P × [r(1 + r)^n] / [(1 + r)^n − 1]
Where:
P = Loan amount (home price minus down payment)
r = Monthly interest rate (annual rate ÷ 12 ÷ 100)
n = Total monthly payments (years × 12)
If interest rate is 0: M = P ÷ nThe standard amortization formula calculates the fixed monthly principal and interest payment for a fully amortizing loan. Each payment covers part of the loan balance (principal) and part of the interest owed for that month. Over time, the principal portion grows while the interest portion shrinks. Property tax, insurance, and HOA are added separately because they are not part of the loan itself.
Calculation note: values are processed in the order shown above, using the current input units.
Worked Examples
Example 1: Standard 30-Year Fixed
Loan amount = $350,000 − $70,000 = $280,000. Monthly rate = 6.5 ÷ 12 ÷ 100 = 0.005417. Over 360 months, the principal and interest payment is $1,770.09. Property tax, insurance, and HOA would add to this.
Example 2: 15-Year with Extras
Loan amount = $200,000. Monthly P&I over 180 months at 5% = $1,581.59. Monthly property tax = $250. Monthly insurance = $100. Total estimated monthly payment = $1,931.59.
Common mistakes
- Forgetting to subtract the down payment from the home price before calculating
- Entering the monthly interest rate instead of the annual rate
- Ignoring property tax, insurance, and HOA when comparing properties
- Assuming the entire monthly payment goes toward building equity
- Comparing 15-year and 30-year loans only by monthly payment without looking at total interest