Mortgage Calculator
Estimate your monthly mortgage payment with principal & interest, property tax, insurance, PMI, and HOA. See the full amortization schedule and the impact of extra payments.
How to Use
- Enter the home price and your down payment in dollars.
- Enter the annual interest rate (APR) and pick a loan term (10, 15, 20, or 30 years).
- Add annual property tax, annual homeowner's insurance, monthly PMI (if down payment is below 20%), and monthly HOA dues.
- Optionally add an extra monthly principal payment to see the payoff accelerate.
- Read the breakdown: principal & interest, taxes/insurance/PMI/HOA, and total monthly PITI.
- Use the amortization schedule to see how each payment splits between principal and interest over the life of the loan.
Formulas
A Brief History of the American Mortgage
The amortizing mortgage as we know it — a level monthly payment that slowly converts interest into principal over decades — is a 20th-century invention. Before the Great Depression, U.S. home loans typically ran 5 to 10 years with a balloon payment at the end. When property values collapsed in 1933, millions of borrowers couldn't refinance their balloons and lost their homes. The Home Owners' Loan Corporation (1933) and then the Federal Housing Administration (1934) re-engineered the loan: long term, fully amortizing, fixed rate, low down payment with mortgage insurance.
The 30-year fixed-rate mortgage became the American default after World War II, supported by FHA insurance, the GI Bill, and a secondary market built around Fannie Mae (1938) and later Freddie Mac (1970). The math behind the level payment — the same annuity formula used for bonds and pensions — predates these institutions by centuries; what was new was applying it to housing at scale. The 2008 financial crisis revealed how badly the system had drifted from those original constraints, and the post-crisis reforms (Dodd-Frank, ability-to-repay rules, qualified mortgages) pulled it most of the way back.
Other countries took different paths: Canada and the UK favor 5-year fixed teasers that reset to the prevailing rate. Germany prefers shorter amortizing loans with mandatory savings. Japan rolled out 100-year mortgages briefly in the 1980s bubble. The 30-year fixed remains a uniquely American product, and the principal-and-interest formula above is the same regardless of country — only the term, rate structure, and tax treatment differ.
About This Calculator
This calculator computes the standard fully-amortizing fixed-rate mortgage payment using the annuity formula above, then layers on monthly tax/insurance escrow, PMI, and HOA to give your true PITI cost. Down payment, rate, and term are the big three drivers; small changes to any of them can shift the monthly by hundreds of dollars and the lifetime interest by tens of thousands.
The extra-payment field models additional principal applied at the start of each period — every dollar reduces the balance interest is calculated against in subsequent months. The calculator surfaces the new payoff date and total interest saved. Everything runs entirely in your browser; no income, balance, or credit information is transmitted or stored. Use this for planning and shopping, then verify with your lender's official Loan Estimate before signing.
Frequently Asked Questions
What is PITI?
PITI stands for Principal, Interest, Taxes, and Insurance — the four components most lenders include when calculating your true monthly housing cost. Many also add HOA dues and PMI when applicable. Lenders qualify you on PITI, not just principal and interest, because tax and insurance escrow are typically collected with the mortgage payment.
When do I have to pay PMI?
Private Mortgage Insurance is generally required by conventional lenders when your down payment is less than 20% of the home's purchase price. It typically costs 0.3%–1.5% of the loan amount per year, billed monthly. Once your loan-to-value ratio reaches 78–80%, you can usually request PMI removal. FHA loans use a similar charge called MIP that follows different rules.
How much do extra payments save me?
Extra payments are applied directly to the principal, which reduces the balance interest is calculated against. Even small monthly extras (e.g., $100) on a 30-year mortgage can shave off years and tens of thousands in interest. The calculator shows the exact savings in interest and the new payoff date once you enter an extra-payment amount.
What's the difference between APR and interest rate?
The interest rate is the cost of borrowing the principal. APR (Annual Percentage Rate) includes the interest rate plus most fees (origination, discount points, certain closing costs) expressed as an annualized rate. APR is always equal to or greater than the note rate; comparing APRs is the fairest way to shop loans.
Why does early in the loan have so much interest?
Mortgage payments are level (the same each month) but the interest portion is calculated against the remaining balance. At the start, the balance is at its highest, so interest dominates. As principal is paid down, the interest portion shrinks and principal grows. By year 15 of a 30-year loan, principal and interest are roughly equal each month.
Does this include closing costs?
No — closing costs (loan origination, title insurance, appraisal, escrow setup, transfer taxes) are paid up front and not part of the monthly mortgage. Budget 2%–5% of the purchase price separately. To compare loans including closing costs, look at APR rather than the note rate.
Common Use Cases
Pre-shopping a price range
Plug in different home prices to see what monthly payment you can comfortably afford before talking to a lender. Lenders typically cap PITI at 28%–36% of gross monthly income.
Comparing 15-year vs. 30-year terms
A 15-year loan has higher monthly payments but pays off twice as fast and saves enormous interest. The calculator makes the trade-off concrete in dollar terms.
Deciding whether to put 20% down
Toggle between 10% and 20% down to see whether eliminating PMI is worth the larger up-front cash outlay vs. keeping that money invested elsewhere.
Modeling extra payments
See exactly how much faster the loan pays off and how much interest you save by adding $50, $100, or $500 to the principal each month.
Refinance break-even
Re-run the calculator with the new rate and remaining balance to compare total cost against your current loan, then weigh that against refinance closing costs.
House-hacking and rental analysis
Estimate the PITI for a property you might rent out, then check whether projected rent comfortably covers PITI plus maintenance and vacancy reserves.
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