Mortgage Calculator guide
Estimate your full monthly house payment, not just principal and interest. Add property tax, homeowners insurance, PMI, and HOA dues to see the PITI number lenders actually qualify you on.
The formula behind your monthly payment
A fixed-rate mortgage payment is M = P × r(1 + r)^n ÷ ((1 + r)^n − 1), where P is the loan amount, r is the monthly rate (APR ÷ 12), and n is the number of monthly payments. This calculator subtracts your down payment from the home price to get P, then solves that formula.
That formula gives principal and interest only, often written P&I. Your real monthly bill is higher once property tax, homeowners insurance, and possibly PMI or HOA dues are added, which is why the calculator asks for those too and shows the full total.
Worked example: a $400,000 home
Home price $400,000, 20 percent down ($80,000), 6.5 percent APR, 30 years. The loan is $320,000 and the monthly rate is 0.065 ÷ 12 = 0.005417. Plugging in 360 payments gives $2,022.62 a month. Over 30 years you pay $408,142 in interest, more than the loan itself.
Same loan on a 15-year term: $2,787.54 a month, $765 more, but total interest falls to $181,758. That is about $226,000 saved for committing to the higher payment.
Rate sensitivity is real. At 7.0 percent the 30-year payment rises to $2,128.97; at 6.0 percent it drops to $1,918.56. Half a point is roughly $100 a month on this loan, or about $37,000 over the full term.
What P&I leaves out
Property tax: the US average effective rate is around 1 percent of home value per year, but it ranges from under 0.5 percent in Hawaii to over 2 percent in New Jersey and Illinois. At 1.1 percent, a $400,000 home adds about $367 a month.
Homeowners insurance: commonly $100 to $250 a month, more in Florida, Louisiana, and wildfire zones in California. PMI: if you put less than 20 percent down on a conventional loan, expect roughly 0.3 to 1.5 percent of the loan per year until you reach 20 percent equity. FHA loans carry their own mortgage insurance premium.
P&I plus those costs is PITI, the number lenders actually qualify you on, and the headline figure this calculator shows.
How much house can you afford?
The classic guideline is 28/36: keep housing costs under 28 percent of gross monthly income and total debt payments under 36 percent. On a $120,000 salary ($10,000 a month), that means about $2,800 for PITI and $3,600 for all debt combined. Lenders will often approve more. Approval is not the same as comfort.
Run a few scenarios before you shop: your target price, 10 percent above it, and your target at a rate one point higher than today's quote. If the worst case still fits your budget, you have room to negotiate.
Worked example: what income does this payment need?
Take the $400,000 home from the example above. P&I is $2,022.62. Add $367 of property tax and $150 of insurance and PITI comes to about $2,540 a month. Under the 28 percent housing guideline, that needs about $9,070 of gross monthly income, or roughly $109,000 a year. If you also carry a $450 car payment and $250 in student loans, total debt is $3,240, about 36 percent of $9,070. Right at the limit.
If those numbers feel tight, the levers are clear: a bigger down payment lowers P and can remove PMI, a lower rate cuts interest, and a cheaper home cuts everything, including tax and insurance. Buying down the rate with points helps only if you keep the loan long enough for the monthly savings to exceed the upfront cost.
Down payment: 20 percent is not a rule
Conventional loans allow as little as 3 percent down, FHA loans 3.5 percent, and VA and USDA loans can require nothing down for eligible borrowers. The trade-off is mortgage insurance and a larger loan. On the example home, 5 percent down means borrowing $380,000 instead of $320,000, which raises P&I to about $2,402 before PMI.
Do not drain your savings to hit 20 percent. Closing costs typically run 2 to 5 percent of the price, and new homeowners face repairs almost immediately. Keeping three to six months of expenses in reserve is usually worth more than avoiding a PMI payment you can cancel later.
Before you sign
Compare Loan Estimates from at least three lenders, and compare APR, not just the note rate, because APR folds in points and fees. Ask whether a rate buydown or points make sense for how long you plan to stay. This calculator gives you a clean baseline; a licensed loan officer can price the details.
How we calculate: sources
Frequently asked questions
What is PITI?
Principal, interest, taxes, and insurance: the four parts of a typical monthly mortgage payment. Lenders use PITI (plus HOA dues, if any) when they check your debt-to-income ratio.
What is the monthly payment on a $400,000 house?
With 20% down ($80,000) on a 30-year loan at 6.5%, principal and interest is about $2,023. Add 1.1% property tax ($367) and $125 of insurance and the full payment is about $2,514 a month.
When do I have to pay PMI?
On a conventional loan, when you put less than 20% down. It typically costs 0.3% to 1.5% of the loan per year. Under the Homeowners Protection Act, it must end automatically when the balance reaches 78% of the original home value, and you can request removal at 80%.
How much does a 1% rate change affect my payment?
On a $320,000 30-year loan, going from 6% to 7% raises principal and interest from $1,919 to $2,129 a month, about $210 more, or about $76,000 over the full term.
How can I lower my monthly mortgage payment?
Put 20% down to skip PMI, shop at least three lenders (rate quotes often differ by 0.25% or more), consider buying discount points (1 point costs 1% of the loan and typically cuts the rate by about 0.25%), and check whether your county offers a homestead property tax exemption.
Does this include closing costs?
No. Closing costs usually run 2% to 5% of the loan amount and are paid upfront, not in the monthly payment. Budget for them separately from your down payment.
Is this financial advice?
No. It is an educational estimate. Your lender's Loan Estimate is the official figure.
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What is the monthly payment on a $300,000 mortgage?
At 6.5 percent for 30 years, principal and interest is about $1,896 a month. Taxes and insurance are extra.
Is a 15-year or 30-year mortgage better?
A 15-year loan costs far less interest but has a much higher payment. A 30-year loan gives flexibility; you can still prepay principal to shorten it.