Mortgage Calculator
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Result
Total monthly payment
- Principal & interest
- $2,124
- Loan amount
- $336,000
- Total interest paid
- $428,549
- Property tax
- $315
- Home insurance
- $150
- Down payment
- $84,000
- Total of all payments
- $848,549
- Paid off by
- Dec 1, 2055
- Over this term you will pay more in interest than the amount you borrowed. Shortening the term or overpaying changes that sharply.
- Principal$336,00044%
- Interest$428,54956%
Amortization schedule
Every scheduled payment, split into interest and principal, with the balance remaining.
| # | Date | Payment | Principal | Interest | Balance |
|---|---|---|---|---|---|
| 1 | Jan 1, 2026 | $2,124 | $304 | $1,820 | $335,696 |
| 2 | Feb 1, 2026 | $2,124 | $305 | $1,818 | $335,391 |
| 3 | Mar 1, 2026 | $2,124 | $307 | $1,817 | $335,084 |
| 4 | Apr 1, 2026 | $2,124 | $309 | $1,815 | $334,775 |
| 5 | May 1, 2026 | $2,124 | $310 | $1,813 | $334,465 |
| 6 | Jun 1, 2026 | $2,124 | $312 | $1,812 | $334,153 |
| 7 | Jul 1, 2026 | $2,124 | $314 | $1,810 | $333,839 |
| 8 | Aug 1, 2026 | $2,124 | $315 | $1,808 | $333,523 |
| 9 | Sep 1, 2026 | $2,124 | $317 | $1,807 | $333,206 |
| 10 | Oct 1, 2026 | $2,124 | $319 | $1,805 | $332,887 |
| 11 | Nov 1, 2026 | $2,124 | $321 | $1,803 | $332,567 |
| 12 | Dec 1, 2026 | $2,124 | $322 | $1,801 | $332,244 |
How is a mortgage payment calculated?
A monthly mortgage payment is calculated with the amortization formula M = P[r(1+r)^n]/[(1+r)^n−1], where P is the loan principal, r is the monthly interest rate, and n is the number of payments. Property tax, homeowners insurance and PMI are added on top of this figure.
M = P · [ r(1 + r)^n ] / [ (1 + r)^n − 1 ]- M
- Monthly principal and interest payment
- P
- Loan principal — the price minus the down payment
- r
- Monthly interest rate — the annual rate divided by 12
- n
- Total number of monthly payments — years × 12
This is the standard amortizing-loan formula. It finds the single fixed payment that exactly clears the balance after n payments, given that interest accrues on whatever is still outstanding each month. The consequence is that the split between interest and principal changes every month while the payment itself does not. Early on the balance is large, so almost all of the payment is interest; late in the term the balance is small and almost all of it is principal. On a $336,000 loan at 6.5% over 30 years, the first payment is about $2,124, of which roughly $1,820 is interest and only $304 touches the principal — you have paid over two thousand dollars and reduced the debt by three hundred. The crossover, where more of the payment goes to principal than interest, arrives around year 18 at this rate. Property tax, insurance, PMI and HOA fees are not part of the loan and do not appear in the formula. Lenders collect them into an escrow account and pay them on your behalf, which is why the total monthly figure is higher than the payment the formula returns, and why a "fixed-rate" mortgage payment still changes when your county reassesses or your insurer reprices.
- Subtract the down payment from the home price to get the principal.
- Divide the annual interest rate by 12 for the monthly rate.
- Multiply the term in years by 12 for the number of payments.
- Apply the amortization formula to get principal and interest.
- Add monthly property tax, insurance, PMI and any HOA dues.
Effective property tax rate by state (2024)
| State | Effective rate | Annual tax on a $400,000 home |
|---|---|---|
| New Jersey | 1.88% | $7,520 |
| Illinois | 1.88% | $7,520 |
| Connecticut | 1.54% | $6,160 |
| Vermont | 1.51% | $6,040 |
| New Hampshire | 1.5% | $6,000 |
| Nebraska | 1.44% | $5,760 |
| Texas | 1.4% | $5,600 |
| Ohio | 1.36% | $5,440 |
| New York | 1.3% | $5,200 |
| Pennsylvania | 1.26% | $5,040 |
| Florida | 0.78% | $3,120 |
| California | 0.7% | $2,800 |
| Arizona | 0.48% | $1,920 |
| Hawaii | 0.29% | $1,160 |
Worked example: A $420,000 home with 20% down at 6.5% over 30 years
A $420,000 home with 20% down at 6.5% over 30 years
A 20% down payment on $420,000 is $84,000, leaving a principal of $336,000. The monthly rate is 6.5% ÷ 12 = 0.5417%, and 30 years is 360 payments. Running those through the amortization formula gives a principal-and-interest payment of $2,123.75. On top of that, property tax at the US average of 0.90% on $420,000 is $3,780 a year, or $315 a month, and insurance at $1,800 a year adds $150. With 20% down there is no PMI. The total monthly payment is therefore about $2,589. Over the full 30 years the interest alone comes to $428,550 — more than the amount borrowed. Switching to a 15-year term raises the monthly principal and interest to $2,927 but cuts total interest to $190,900, saving roughly $237,000. That trade — about $800 more a month for a quarter of a million less in interest — is the single largest decision in the whole transaction.
What each mortgage input means
- Home price
- The agreed purchase price — not the listing price, and not the appraised value.
- Down payment
- What you pay up front, as a percentage of the price. Below 20% and most lenders require mortgage insurance.
- Interest rate
- The rate your lender quoted. Use the interest rate for an accurate payment; compare competing offers on APR, which also includes fees.
- Loan term
- How long you have to repay. Compare 15 and 30 — the difference in total interest is large.
- Property tax rate
- Your county's effective rate. The default is the US average of 0.90%; the table below gives state figures, but rates vary within every state.
- Home insurance
- Annual premium for your homeowner's policy. Your quote or renewal notice has the figure.
- HOA fees
- Monthly dues for a managed community. Not part of the loan, but part of what you pay each month.
- PMI rate
- Private mortgage insurance, typically 0.3%–1.5% of the loan a year. Applied only while your balance is above 80% of the home's value.
- Extra monthly principal
- Paid on top of the scheduled payment, straight off the principal. Tell your servicer it is for principal reduction.
- First payment date
- When the first payment is due. Sets the dates in the amortization schedule.
What this mortgage does not account for
- The rate you enter is treated as the accrual rate, not the APR. APR folds in lender fees and points, so it is slightly higher and is the better figure for comparing offers — but using it here would overstate your payment.
- Property tax and insurance are assumed constant. Both rise over time: counties reassess, and insurance has repriced sharply in several states. A payment quoted today will not be the payment in year ten.
- PMI is estimated from the loan amount and removed once the balance passes 80% of the original price. Your actual rate depends on your credit score and loan type, and FHA mortgage insurance follows different rules that can last the life of the loan.
- Closing costs are not included. Expect 2%–5% of the purchase price due at signing, on top of the down payment.
- No adjustable-rate behaviour is modelled. An ARM's payment changes at the end of the fixed period, and this calculator assumes a fixed rate throughout.
- Extra payments are assumed to go to principal. Some servicers hold them as a prepayment of next month's bill instead, which achieves nothing — state the intent in writing.
Frequently asked questions
What is included in a monthly mortgage payment?
Four things, often called PITI: principal, interest, property taxes and insurance. Principal and interest repay the loan; taxes and insurance are collected into escrow. Under 20% down adds a fifth, PMI, and managed communities add HOA dues.
How much difference does a 15-year mortgage make?
The monthly payment rises substantially but total interest usually falls by more than half. On a $336,000 loan at 6.5%, 30 years costs about $428,000 in interest against roughly $191,000 over 15 years.
When can I stop paying PMI?
Once the balance drops below 80% of the home's value you can request removal, and under the Homeowners Protection Act the servicer must drop it automatically at 78% of the original value. Paying extra principal reaches that point sooner.
How much house can I afford?
Lenders commonly cap total housing costs at 28% of gross monthly income and all debt at 36%. On a $90,000 salary that is roughly $2,100 a month for housing, including tax and insurance rather than just the loan payment.
Does paying extra each month really help?
Yes, and more than most people expect, because every extra dollar stops accruing interest for the whole remaining term. An extra $200 a month on a 30-year loan typically clears it several years early and saves tens of thousands.
Is the interest rate the same as the APR?
No. The interest rate is what accrues on your balance. The APR also includes lender fees and points, so it is usually higher and is the right figure for comparing lenders against each other.
Why is my mortgage payment mostly interest at first?
Interest is charged on the outstanding balance, which is at its largest at the start. As the balance falls the interest portion shrinks and the principal portion grows, even though the total payment stays the same.
Sources and review
“Your lender must automatically terminate PMI when your mortgage balance reaches 78 percent of the original purchase price.”
Homeowners Protection Act of 1998 — PMI cancellation — Consumer Financial Protection Bureau- Facts & Figures 2026, Table 33 — property taxes as a percentage of owner-occupied housing value (2024) — Tax Foundation
Last reviewed .