Use this free mortgage payment calculator to estimate your monthly house payment. Enter the home price, down payment, interest rate and loan term, then add property tax, home insurance, PMI and HOA fees for the full monthly cost. You also get your payoff date, a balance chart and an amortization schedule, and you can see how extra or bi-weekly payments shorten your home loan. It is free and instant, and your numbers stay in your browser.
How to calculate your mortgage payment
A mortgage is a loan used to buy a home, repaid in equal monthly instalments over a set number of years. Each instalment covers part of the money you borrowed (the principal) and the interest the lender charges. Early on, most of the payment is interest; by the end, almost all of it is principal. The principal and interest part is worked out with the standard mortgage payment formula:
M = monthly payment, P = loan amount (home price minus down payment), r = monthly interest rate (annual rate ÷ 12 ÷ 100), n = number of monthly payments (years × 12)
To use it by hand:
- Take away the down payment from the home price to get the loan amount.
- Divide the yearly interest rate by 12, then by 100. A 6.5% rate becomes 0.0054167 a month.
- Multiply the number of years by 12. A 30-year mortgage has 360 payments.
- Put the three numbers into the formula. The calculator above does this for you, to the cent.
What is included in a monthly mortgage payment
The figure a lender quotes is often only principal and interest, but the amount that leaves your account each month is usually higher. In the US the full payment is often called PITI: principal, interest, taxes and insurance. Lenders commonly collect the tax and insurance through an escrow account and pay those bills for you. This calculator can include all of them:
- Principal and interest. The part that repays the loan and pays the lender.
- Property tax. Charged by the local authority, often around 0.5% to 2% of the home value a year in the US. Enter it as a percentage of the price or as a yearly amount.
- Home insurance. Cover for the building, paid each year. Most lenders require it.
- PMI (private mortgage insurance). Usually added when the down payment is under 20% of the price. It is often 0.3% to 1.5% of the loan a year, and it stops once you owe 78% of the home price.
- HOA fees. Monthly homeowners association or service charges, common for condos and some estates.
- Other costs. Anything else you pay each month for the home, such as maintenance.
Example: a $300,000 home
You buy a home for $300,000 with a 20% down payment ($60,000), so you borrow $240,000 at 6.5% a year over 30 years. Property tax is 1.2% of the price ($3,600 a year) and insurance is $1,200 a year. Amounts in this guide are in US dollars, and the maths is the same in any currency.
| Part of the monthly payment | Amount |
|---|---|
| Principal and interest | $1,516.96 |
| Property tax ($3,600 ÷ 12) | $300 |
| Home insurance ($1,200 ÷ 12) | $100 |
| Total per month | $1,916.96 |
Over the 30 years you would pay $546,107 to the lender, of which $306,107 is interest. With only 10% down (a $270,000 loan) and PMI at 0.5% a year, the payment starts at $2,219.08 and falls to $2,106.58 once PMI ends, after about 9 years.
Monthly mortgage payments by home price
A quick guide to principal and interest on a 30-year fixed mortgage with 20% down. Tax, insurance and other costs come on top.
| Home price | Loan (20% down) | Monthly at 6% | Monthly at 7% |
|---|---|---|---|
| $200,000 | $160,000 | $959.28 | $1,064.48 |
| $300,000 | $240,000 | $1,438.92 | $1,596.73 |
| $400,000 | $320,000 | $1,918.56 | $2,128.97 |
| $500,000 | $400,000 | $2,398.20 | $2,661.21 |
| $600,000 | $480,000 | $2,877.84 | $3,193.45 |
| $700,000 | $560,000 | $3,357.48 | $3,725.69 |
| $800,000 | $640,000 | $3,837.12 | $4,257.94 |
If you borrow the whole amount, a $275,000 mortgage over 30 years at 6.5% costs $1,738.19 a month, and a $500,000 mortgage costs $3,160.34 a month.
How the interest rate changes your payment
Even half a percentage point makes a real difference over 30 years. Here is the same $240,000 loan at different rates:
| Interest rate | Monthly payment | Total interest over 30 years |
|---|---|---|
| 5% | $1,288.37 | $223,814 |
| 5.5% | $1,362.69 | $250,570 |
| 6% | $1,438.92 | $278,012 |
| 6.5% | $1,516.96 | $306,107 |
| 7% | $1,596.73 | $334,821 |
| 7.5% | $1,678.11 | $364,121 |
| 8% | $1,761.03 | $393,973 |
Going from 7% to 6% saves about $158 a month and almost $57,000 in interest. That is why it pays to compare offers from several lenders and to improve your credit score before you apply.
15-year vs 30-year mortgage
The same $240,000 loan at 6.5% over different terms:
| Loan term | Principal and interest per month | Total interest |
|---|---|---|
| 10 years | $2,725.15 | $87,018 |
| 15 years | $2,090.66 | $136,318 |
| 20 years | $1,789.38 | $189,450 |
| 30 years | $1,516.96 | $306,107 |
A 15-year loan costs about $574 more each month than a 30-year loan, but it saves roughly $169,789 in interest and you own the home 15 years sooner. Lenders also tend to offer slightly lower rates on shorter terms, which widens the gap. A 30-year loan keeps the monthly payment lower and leaves more room in your budget, and you can still pay it off early with extra payments.
PMI: what it costs and how to avoid it
Private mortgage insurance protects the lender, not you, if you stop paying. On a conventional US loan it is usually required when you put down less than 20%. On a $300,000 home at 6.5% with PMI at 0.5% of the loan a year:
| Down payment | Loan | PMI per month | PMI lasts | Total PMI |
|---|---|---|---|---|
| 5% | $285,000 | $118.75 | 11 years 3 months | $16,031 |
| 10% | $270,000 | $112.50 | 9 years 1 month | $12,263 |
| 20% | $240,000 | none | – | $0 |
By law, lenders must cancel PMI automatically when your balance is scheduled to reach 78% of the original home value, and you can usually ask for it to be removed at 80%. To avoid it altogether, put down 20% or more, ask about loans with lender-paid mortgage insurance (usually at a higher rate), or make extra payments so you reach the limit sooner. Government-backed loans such as FHA loans have their own mortgage insurance rules.
Paying extra and bi-weekly payments
Any extra amount goes straight to the balance, so you owe interest on less money every month after that. On the same $240,000 loan at 6.5% over 30 years:
- $200 extra a month pays the loan off in 21 years 10 months, 8 years 2 months sooner, and saves about $96,270 in interest.
- $5,000 extra once a year pays it off in 17 years 7 months and saves about $142,058.
- A single $10,000 payment after the first year pays it off in 26 years 10 months and saves about $48,753.
- Bi-weekly payments of half the monthly amount ($758.48 every two weeks) pay it off in 24 years 2 months and save about $70,497.
Bi-weekly payments work because a year has 26 two-week periods: 26 half-payments equal 13 full monthly payments instead of 12. Before you pay extra, check that your lender has no early repayment penalty and that extra money goes to the principal straight away, and keep an emergency fund first.
Reading your amortization schedule
The payment schedule under the result shows, for each year or month, how much of your payments went to principal and to interest, and what you still owe. In the early years most of each payment is interest, so the balance falls slowly; the balance graph shows the curve speeding up as the loan gets older. With a first payment date, the schedule shows the real months and years, and the calculator gives the month of your final payment.
How to lower your monthly mortgage payment
- Make a bigger down payment, which shrinks the loan and can remove PMI.
- Shop around for a lower rate: compare the APR, which includes fees, not just the headline rate.
- Choose a longer term, accepting that you will pay more interest overall.
- Ask for PMI to be removed once you reach 20% equity.
- Shop around for home insurance each year, and check that your property tax assessment is correct.
- Look at a less expensive home, or one with lower HOA fees.
Mortgages in the US, UK, Australia and Canada
The maths of a repayment mortgage is the same everywhere, so this calculator works in any currency. Choose your currency in the Currency symbol box at the top of the form. A few local differences are worth knowing:
- United States. The most common home loan is a 30-year fixed-rate mortgage, and 15-year loans are also popular. With less than 20% down, lenders usually charge monthly PMI. Property tax and home insurance are often collected with the payment through an escrow account, which is why the full payment is called PITI. Rates, tax and insurance vary by state and lender.
- United Kingdom. Most homes are bought with a repayment mortgage, often over about 25 years, with a fixed rate for 2 or 5 years before it moves to the lender's variable rate. There is no PMI; a smaller deposit usually means a higher rate instead. Council tax is paid separately, so leave property tax at 0, and Stamp Duty is a one-off tax when you buy in England and Northern Ireland, not part of the monthly payment.
- Australia. Home loans are often over 30 years, and many lenders let you repay weekly, fortnightly or monthly. Paying half the monthly amount each fortnight works like the bi-weekly option above. With a deposit under 20%, lenders usually charge Lenders Mortgage Insurance (LMI) as a one-off cost, often added to the loan, rather than a monthly fee. Council rates are paid separately.
- Canada. With less than 20% down, mortgage default insurance is required and the premium is usually added to the loan. Accelerated bi-weekly payments are common. Fixed-rate Canadian mortgages usually compound interest twice a year rather than monthly, so a lender's figure can differ slightly from this calculator.
If mortgage insurance is added to your loan, add the premium to the home price so the loan amount matches your offer.
Before you borrow
- Decide what monthly payment fits your budget, including tax, insurance and repairs. The Salary Calculator can turn your pay into a monthly figure to compare against.
- Compare interest rates and fees from several lenders, not just the headline rate.
- Ask whether the rate is fixed or can change. This calculator assumes a fixed rate for the whole term.
- Keep savings aside for closing costs, moving and the unexpected.
- For a car, personal or other loan, use the Loan Calculator, and plan your long-term savings with the Retirement Calculator.
