Mortgage Payment Calculator
Calculate your monthly mortgage payment including principal, interest, taxes, and insurance (PITI).
Calculate your monthly payment
Includes principal, interest, taxes, insurance, and PMI if applicable.
How to use this calculator
- Enter your home price—the purchase price or current estimated value of the property.
- Input your down payment in dollars or as a percentage of the home price. The calculator syncs both fields automatically.
- Enter the interest rate from a recent quote or current market average. Even small differences affect total cost.
- Pick your loan term—15, 20, or 30 years. Shorter terms mean higher payments but far less total interest.
- Add annual property tax and insurance estimates. Your lender can provide local averages if you're unsure.
- Optionally add HOA dues if your property is in an HOA community.
- Click Calculate to see your full monthly payment breakdown including PMI (auto-applied if down payment is under 20%).
How mortgage payments are calculated
Your monthly mortgage payment is built from up to five components, commonly remembered by the acronym PITI: Principal, Interest, Taxes, and Insurance. If your down payment is below 20% of the home's value, lenders also require Private Mortgage Insurance (PMI), and many properties carry additional HOA dues. Together, these make up your true monthly housing cost.
The amortization formula
The core of the calculation—the principal and interest portion—uses the standard amortization formula:
M = P × [r(1+r)^n] / [(1+r)^n − 1]
Where:
- M = monthly payment (principal + interest)
- P = loan principal (home price minus down payment)
- r = monthly interest rate (annual rate ÷ 12 ÷ 100)
- n = total number of payments (years × 12)
Adding taxes, insurance, and PMI
Property taxes are typically quoted as an annual percentage of assessed value (often 0.5%–2.5% depending on state), but for monthly payment purposes we divide the annual amount by 12. Homeowners insurance averages $1,200–$2,500 per year for a standard policy, also divided by 12. PMI is typically 0.3%–1.5% of the original loan amount per year, again spread across 12 monthly installments. Once your equity reaches 20% (either through payments or appreciation), PMI can be removed on conventional loans.
How amortization changes over time
In the early years of a mortgage, the vast majority of each payment goes toward interest, with only a small slice reducing principal. As the principal balance declines, less interest accrues each month, so a larger share of each payment chips away at the loan. By the final years, almost the entire payment goes to principal. This is why early extra payments have outsized impact—every dollar of principal eliminated saves years of future interest on that amount.
Why APR matters more than the rate
The interest rate you're quoted is just the cost of borrowing the principal. The Annual Percentage Rate (APR) includes the rate plus lender fees, points, and certain closing costs—giving you a true picture of the loan's cost. A 6.75% rate with high fees may have an APR of 7.1%, while a 6.9% rate with low fees may have an APR of 7.0%. Always compare APRs, not just rates, when shopping lenders.
Worked example
Let's walk through a concrete example to see how the numbers come together.
Scenario: A $450,000 home with 20% down ($90,000), a 30-year fixed mortgage at 6.75% interest, $5,400/year property tax, and $1,800/year insurance.
- Loan principal: $450,000 − $90,000 = $360,000
- Monthly interest rate: 6.75% ÷ 12 = 0.5625%
- Number of payments: 30 × 12 = 360
- Monthly P&I: $360,000 × [0.005625 × (1.005625)^360] ÷ [(1.005625)^360 − 1] = $2,334
- Monthly tax: $5,400 ÷ 12 = $450
- Monthly insurance: $1,800 ÷ 12 = $150
- PMI: $0 (20% down eliminates PMI)
Total monthly payment: $2,934
Over 30 years, you'd pay $840,240 in P&I alone—meaning $480,240 in interest on a $360,000 loan. This is why even small rate reductions or extra payments have huge long-term impact.
Glossary
- PITI
- Principal, Interest, Taxes, and Insurance—the four core components of a monthly mortgage payment.
- Amortization
- The process of paying off a loan in equal installments, where early payments are mostly interest and later payments are mostly principal.
- PMI
- Private Mortgage Insurance—required on conventional loans with less than 20% down. Automatically removed at 78% loan-to-value.
- APR
- Annual Percentage Rate—the true annual cost of borrowing, including interest plus lender fees and points.
- Equity
- The portion of your home's value that you own outright—home value minus remaining loan balance.
Frequently asked questions
Quick answers to the most common questions about mortgage payment calculator.
This calculator is provided for informational and educational purposes only and does not constitute financial, legal, tax, or professional advice. Results are estimates based on the inputs you provide and standard assumptions. Actual figures may vary. Please consult a qualified professional before making financial decisions. Read our full disclaimer.