Mortgage Calculator

How the payment is calculated

Principal and interest use the standard amortization formula: payment = P·i / (1 − (1+i)⁻ⁿ), where P is the loan amount (home price minus down payment), i is the monthly interest rate and n is the number of monthly payments. Each payment covers that month's interest first; the remainder reduces the balance, which is why early payments are mostly interest and later payments are mostly principal. Property tax, home insurance, PMI and HOA are added on top of principal and interest to show the full monthly cost, and the amortization table below tracks the loan balance year by year so you can see how much of each year's payments actually goes toward reducing what you owe.

This is the same fixed-rate amortization method described by the Consumer Financial Protection Bureau.

Frequently asked questions

Why is the total interest so large?

Interest compounds over decades. A 300,000 loan at 6% for 30 years costs about 347,500 in interest — more than the house. Shortening the term to 15 years cuts that to roughly 155,700, at the price of a higher monthly payment.

Does this include taxes and insurance?

Yes — enter your annual property tax, annual home insurance, and monthly PMI/HOA and they're added to principal and interest for a full monthly payment. Leave any of them at 0 if they don't apply or you're not sure yet; lenders typically collect all of these in the same monthly bill via an escrow account.

How much does an extra payment help?

A lot: anything extra goes straight to principal, which shrinks every future interest charge. One extra monthly payment per year typically takes 4–6 years off a 30-year loan.

When can I stop paying PMI?

PMI (private mortgage insurance) usually applies when your down payment is under 20% of the home price. Lenders are required to let you request cancellation once your loan balance drops to 80% of the home's original value, and must automatically remove it at 78%.