Free Mortgage Calculator
Enter the home price, your down payment, the interest rate, and the loan term to see your monthly principal and interest payment, plus the total interest you would pay over the life of the loan.
This free mortgage calculator uses the standard amortization formula: the monthly payment equals the loan amount times the monthly rate, divided by one minus the monthly rate factor raised to the negative number of payments. For example, a $320,000 loan at 6.5 percent for 30 years works out to about $2,023 a month in principal and interest, with roughly $408,000 in total interest.
Estimates only. This tool calculates principal and interest. It does not include property taxes, homeowners insurance, PMI, or HOA dues, which raise your real monthly payment. Not financial advice.
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How mortgage math works
A fixed-rate mortgage payment is set by the amortization formula: M = P times r divided by (1 minus (1 + r) raised to the power of negative n). P is the loan amount, r is the monthly interest rate (annual rate divided by 12), and n is the total number of monthly payments. The formula spreads the loan plus all its interest into equal monthly payments.
Take a $320,000 loan at 6.5 percent for 30 years. The monthly rate is 0.065 divided by 12, about 0.005417, and there are 360 payments. Plug those in and the monthly payment comes out to about $2,023. Over 360 payments that totals roughly $728,000, which means about $408,000 of it is interest. More than half of what you pay goes to the lender, not the house.
Early payments are mostly interest. In month one of that same loan, about $1,733 of the $2,023 payment is interest and only $290 reduces the balance. That split flips slowly: by year 15, roughly half of each payment attacks the principal. This front-loading is why extra payments in the first years cut total interest so dramatically.
Shortening the term changes the picture. A 15-year loan at a lower rate (lenders typically price 15-year loans below 30-year loans) can cut total interest by more than half, at the cost of a much higher monthly payment. The calculator above lets you compare terms side by side to see the tradeoff in dollars.
Your real monthly housing cost is PITI: principal, interest, property taxes, and homeowners insurance, plus PMI if your down payment is under 20 percent and any HOA dues. Lenders qualify you on PITI, not just principal and interest, so treat this calculator's number as the starting point, not the finish line.
Mortgage calculator questions
How is a monthly mortgage payment calculated?
With the standard amortization formula: the monthly payment equals the loan amount times the monthly interest rate, divided by one minus the quantity (1 + monthly rate) raised to the negative number of payments. For example, a $320,000 loan at 6.5 percent for 30 years (360 payments) works out to about $2,023 per month in principal and interest.
How much house can I afford on my salary?
Lenders commonly use the 28/36 rule: keep total housing costs (principal, interest, taxes, insurance) at or below 28 percent of gross monthly income, and keep all monthly debts at or below 36 percent. On a $100,000 salary, 28 percent is about $2,333 a month for housing. Your down payment, debts, credit score, and local taxes all shift the real number.
Is a 15-year or 30-year mortgage better?
A 15-year mortgage builds equity far faster and can cut lifetime interest by more than half, but the monthly payment is much higher, often 40 to 50 percent more than a 30-year payment on the same loan. A 30-year mortgage costs more in interest but keeps the required payment lower, which leaves room for investing, saving, or making extra principal payments when you choose.
What is PMI and when do I pay it?
Private mortgage insurance protects the lender, not the borrower. Conventional loans usually require PMI when the down payment is under 20 percent of the home price. It typically costs 0.5 to 1 percent of the loan amount per year, added to the monthly payment, and it usually drops off once you reach 20 percent equity. FHA loans have their own version, called MIP, with different rules.