A mortgage payment is more than principal and interest. Property tax, home insurance, HOA fees, and — if your down payment is below 20% — private mortgage insurance (PMI) all add up to the amount you actually pay each month. This calculator breaks down every piece so you can see exactly where your money goes and how much of it builds equity versus how much is interest.
How to Use This Mortgage Calculator
Enter the home price and your planned down payment; the calculator subtracts one from the other to find your loan amount. Choose a loan term — 15, 20, or 30 years are the most common — and enter the interest rate your lender has quoted or that you're comparing. If you know your annual property tax and home insurance costs, add them to see your full monthly payment rather than just principal and interest. The extra monthly payment field is optional: use it to see exactly how much time and interest an extra payment each month would save.
How Mortgage Payments Are Calculated
A fixed-rate mortgage uses an amortizing payment: the same amount is paid every month for the life of the loan, but the split between principal and interest shifts over time. Early payments are mostly interest, because interest is charged on the current balance and the balance starts at its highest point. As the balance falls, less of each payment goes to interest and more goes to principal — which is why the last few years of a mortgage pay down principal far faster than the first few.
Mortgage Payment Formula
The monthly principal-and-interest payment is:
M = P × [ i(1 + i)^n ] / [ (1 + i)^n − 1 ]
Where P is the loan amount, i is the monthly interest rate (annual rate ÷ 12), and n is the total number of monthly payments (loan term in years × 12). This calculator applies that formula, then adds property tax, insurance, HOA, and PMI as separate monthly costs on top.
Example Calculation
A $400,000 home with a $80,000 down payment (20%) leaves a $320,000 loan. At 6.5% over 30 years, principal and interest come to about $2,023 a month. Add $400 a month in property tax and $125 in insurance, and the total monthly payment lands around $2,548 — with no PMI required, since the down payment already clears the 20% equity threshold.
What Affects Your Monthly Mortgage Payment?
- Loan amount — a larger loan means a larger payment, roughly in proportion, since the amortization formula scales linearly with principal.
- Interest rate — even a small change compounds significantly over a 30-year term; a 1-point difference on a $320,000 loan changes the monthly payment by more than $200.
- Loan term — a 15-year loan carries a lower rate and far less total interest, but a meaningfully higher monthly payment than a 30-year loan for the same amount.
- Property tax and insurance — these vary by location and coverage, and are often the most-overlooked piece of "how much house can I afford."
- Down payment — beyond reducing the loan amount, a down payment below 20% typically triggers PMI, an added monthly cost that disappears once you've built 20% equity.