Mortgage Calculator
Calculate your monthly mortgage payments, total interest, and amortization schedule. See how different loan terms and interest rates affect your payments.
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Mortgage Tips
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20% Down Payment
Avoid PMI by putting down at least 20% of the home's value.
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Shorter Terms Save Money
A 15-year mortgage has higher payments but saves thousands in interest.
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Check Your Credit
Higher credit scores qualify for lower interest rates.
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Shop Around
Compare rates from multiple lenders to get the best deal.
Affordability Calculator
Understanding Mortgage Calculations
A mortgage is likely the largest financial commitment you'll make in your lifetime. Understanding how mortgage payments are calculated can help you make informed decisions about your home purchase.
How Mortgage Payments Work
Mortgage payments typically consist of four components:
- Principal: The amount borrowed to buy the home
- Interest: The cost of borrowing the money
- Taxes: Property taxes assessed by your local government
- Insurance: Homeowners insurance and possibly PMI (Private Mortgage Insurance)
Amortization: Paying Down Your Loan
With a fixed-rate mortgage, your payment stays the same each month, but the portion going toward principal vs. interest changes over time. Early in the loan, most of your payment goes toward interest. As you pay down the principal, more of each payment goes toward reducing the loan balance.
Factors Affecting Your Mortgage Payment
- Loan Amount: The more you borrow, the higher your payment
- Interest Rate: Even small rate differences significantly impact payments
- Loan Term: Shorter terms mean higher payments but less total interest
- Down Payment: Larger down payments reduce the loan amount and may eliminate PMI