How to Use This Mortgage Calculator
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Enter loan details
Input home price, down payment, interest rate and loan term. Adjust currency at the top for your country.
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Add costs
Expand optional sections for taxes, insurance, PMI, HOA and extra payments for a complete PITI picture.
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Review results
See your full amortization schedule, payment breakdown chart, and total interest over the life of the loan.
The Mortgage Payment Formula
Every mortgage calculator uses the standard amortization formula. Here is exactly how your monthly principal & interest payment is calculated:
M = P ร [ r(1+r)โฟ ] รท [ (1+r)โฟ - 1 ]
M = Monthly P&I payment ยท P = Loan principal ยท r = Monthly rate (annual รท 12) ยท n = Total payments (years ร 12)
For a $320,000 loan at 6.57% for 30 years: r = 0.5475%, n = 360 payments โ monthly P&I โ $2,034. This is principal and interest only - taxes, insurance, and PMI are added on top to arrive at your full PITI payment.
Understanding PITI
PITI stands for Principal, Interest, Taxes, and Insurance - the four components of a complete monthly mortgage payment. Lenders use your PITI, not just P&I, when evaluating your debt-to-income ratio. Most calculators only show P&I, which can understate your real payment by $500-$900/month depending on location and home value.
15-Year vs. 30-Year Mortgage Comparison
The choice between a 15-year and 30-year mortgage is one of the most consequential decisions in home financing. On a $320,000 loan:
| Factor | 30-Year Fixed | 15-Year Fixed |
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| Interest Rate | 6.57% | 5.91% |
| Monthly P&I | $2,034 | $2,688 |
| Total Interest | $412,160 | $163,840 |
| Total Paid | $732,160 | $483,840 |
| Interest Saved | - | $248,320 |
| Equity at Year 5 | ~$18,000 | ~$68,000 |
| Flexibility | High (lower payment) | Lower (higher payment) |
The 15-year borrower saves over $248,000 in total interest but pays $654 more per month. Use this calculator to model both scenarios with your own numbers.
Frequently Asked Questions
What credit score do I need to get a mortgage?
Conventional loans typically require a minimum score of 620, though scores of 740+ earn the best rates. FHA loans accept 580+ (with 3.5% down) or 500-579 (with 10% down). VA and USDA loans have no official minimum but most lenders require 640+. Every 20-point improvement in your score can meaningfully reduce your interest rate.
How much of my income should go toward a mortgage?
The classic 28/36 rule states: your housing costs (PITI) should not exceed 28% of gross monthly income, and total debt payments should not exceed 36%. On a $100,000 annual income ($8,333/month), that means a maximum PITI of $2,333 and total debts of $3,000/month. Lenders may approve up to 43-50% DTI, but staying closer to 28% gives you financial breathing room.
What is PMI and when can I remove it?
Private Mortgage Insurance (PMI) protects the lender - not you - if you default. It is required on conventional loans when your down payment is less than 20%. PMI typically costs 0.4%-1.5% of the loan annually. Under the federal Homeowners Protection Act, PMI must be automatically cancelled when your loan balance reaches 78% of the original purchase price. You can request cancellation at 80% LTV.
Does making extra payments really save that much?
Yes. On a $320,000 loan at 6.57% for 30 years, adding just $200/month to your payment saves approximately $72,000 in interest and pays off the loan 5+ years early. Each extra dollar of principal paid today eliminates future interest charges at your full mortgage rate - a guaranteed, risk-free return. Use the Extra Payments section above to model your own scenario.
What is the difference between interest rate and APR?
The interest rate determines your monthly payment. The Annual Percentage Rate (APR) includes the interest rate plus lender fees, origination charges, and certain closing costs - expressed as an annualized rate. APR is always higher than the interest rate and is the better tool for comparing loan offers across different lenders, since it captures the true total borrowing cost.
How accurate is this mortgage calculator?
The principal and interest calculation is mathematically exact when your inputs are correct. Property tax and insurance are estimates - actual amounts vary by location. For a confirmed payment, request a Loan Estimate from your lender; they are required to provide one within 3 business days of your application. This calculator is intended as an educational planning tool, not a lending commitment.
