Mortgage Calculator
Estimate your monthly mortgage payment with taxes, insurance, and a full amortization schedule.
$85,000 · 20.0% of price
Taxes, insurance & fees
PMI is charged only while your down payment is under 20%, and drops off automatically once you reach 22% equity.
Extra payments (optional)
Loan start date
Estimated monthly payment
$2,688.61
Loan amount
$340,000
Total interest
$433,651
Total cost
$773,651
Payoff
July 2056
Term
30 yr
- Principal & interest$2,149.0380%
- Property tax$389.5814%
- Home insurance$150.006%
How mortgage payments are calculated
A fixed-rate mortgage is repaid with equal monthly payments that cover the interest accrued that month plus a slice of the principal. The payment for principal and interest comes from the standard amortization formula:
M = P × [ r(1 + r)n ] / [ (1 + r)n − 1 ]
- M — the monthly principal & interest payment
- P — the loan amount (home price minus down payment)
- r — the monthly interest rate (annual rate ÷ 12)
- n — the total number of monthly payments (years × 12)
Property taxes, homeowners insurance, and HOA fees aren't part of the loan itself, but lenders usually collect them with the payment, so this calculator adds them to show your realistic monthly cost.
Worked example
Take a $425,000 home with 20% down ($85,000), leaving a $340,000 loan at 6.5% for 30 years. The monthly rate is 6.5% ÷ 12 ≈ 0.5417%, and n is 360 payments. Plugging into the formula gives a principal & interest payment of about $2,149. Add 1.1% property tax (~$390/mo) and $1,800/yr insurance ($150/mo), and the realistic monthly cost is roughly $2,689. Over 30 years, total interest comes to about $433,600 — more than the original loan, which is why extra principal payments are so powerful.
Frequently asked questions
What's included in a monthly mortgage payment?
Most payments have four parts, often called PITI: principal (repaying the loan), interest (the lender's charge), property taxes, and homeowners insurance. Many homes also add HOA fees, and loans with less than 20% down usually add private mortgage insurance (PMI).
How does the loan term change what I pay?
A shorter term (like 15 years) means higher monthly payments but far less total interest, because the balance shrinks faster and interest accrues for fewer years. A 30-year term keeps payments lower but can double the interest paid over the life of the loan.
Do extra payments really make a difference?
Yes — every extra dollar goes straight to principal, so all future interest is calculated on a smaller balance. Even a modest extra monthly payment early in the loan can cut years off the term. Use the “Extra payment” field above to see your exact savings.
Why is my early payment mostly interest?
Interest each month is your remaining balance times the monthly rate. Early on the balance is at its largest, so interest consumes most of the payment. As the balance falls, the same payment retires more principal — that accelerating shift is what the amortization charts show.
• Fixed interest rate for the full term.
• Property tax is a constant percentage of the home price.
• Insurance and HOA fees stay flat over time.
• Extra payments are applied entirely to principal.
• PMI, closing costs, and points aren't included — with less than 20% down, expect PMI of roughly 0.3–1.5% of the loan per year.
• Taxes and insurance usually rise over time; treat long-range totals as estimates.
• Adjustable-rate mortgages (ARMs) reprice after the intro period and aren't modeled here.
• Results are for education, not financial advice — confirm numbers with your lender.
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