Mortgage Calculator

A mortgage calculator tells you what your monthly house payment will be before you sign anything. It uses your home price, down payment, interest rate, and loan term to give you a clear number.

• Home budget planning: Know your monthly payment before making an offer so you stay within budget.
• Comparing loan terms: Run 15 vs. 30 years side by side and see the difference in monthly payment and total interest paid.
• Refinancing decision: Enter your new rate and remaining balance to see if refinancing saves money.
• Down payment planning: Adjust the down payment to see how it changes your payment and LTV.

1. 1Enter the home price and your down payment. The loan amount is the difference.
2. 2Enter the annual interest rate your lender is offering.
3. 3Enter the loan term (usually 15 or 30 years).
4. 4Add annual property tax and home insurance for a full PITI payment.
5. 5The calculator applies the amortization formula to your loan amount.

• Forgetting to add property tax and insurance: The principal-and-interest payment is only part of what you owe monthly. Property tax, homeowner's insurance, and PMI (if your down payment is under 20%) all add to the actual payment.
• Using the listed rate instead of the APR: The quoted interest rate does not include lender fees. The APR does. For comparison shopping, use the APR. For the monthly payment formula, use the interest rate.
• Ignoring how extra payments work: An extra $100/month on principal can cut years off a 30-year mortgage. Run the loan calculator with a higher payment amount to see the impact before committing.
• Comparing different loan terms by monthly payment alone: A 30-year mortgage has a lower monthly payment than a 15-year, but you pay far more interest in total. Compare total repayment costs, not just the monthly figure.

• Try 15 vs 30 years side by side: Run the calculator twice: once with a 15-year term, once with 30. The monthly payment difference is often smaller than expected, but the interest saved over the life of the loan is significant.
• Stress-test with a higher rate: If your rate is variable or you are shopping before locking, run the calculator with a rate 1-2 percentage points higher. This shows your payment if rates rise and helps you size the risk.
• Reverse-engineer from a target payment: If you know what monthly payment you can afford, work backward: start with a loan amount, run the calculator, and adjust the amount until the payment hits your budget.
• Account for PMI removal: If your down payment is under 20%, you typically pay PMI until you reach 20% equity. Track your balance over time and request PMI removal as soon as you are eligible.