About This Tool
The mortgage calculator helps you estimate your monthly payment for a home loan, breaking down principal and interest. It's a must-have tool when house hunting to understand what you can afford. You can adjust the loan amount, interest rate, and term to see how different scenarios affect your payment. It's also useful for comparing fixed-rate vs. adjustable-rate mortgages or seeing the impact of a larger down payment.
How It Works
It uses the same amortization formula as a loan calculator: M = P * [r(1+r)^n] / [(1+r)^n - 1], where M is the monthly payment, P is the loan principal (home price minus down payment), r is the monthly interest rate, and n is the total number of monthly payments. The result includes only principal and interest, not taxes, insurance, or PMI.
Examples
- A $350,000 home with a 20% down payment ($70,000) at 6.5% fixed rate for 30 years gives a monthly payment of about $1,770.
- If you buy a $250,000 home with 10% down ($25,000) at 5% for 15 years, your monthly payment is roughly $1,779.
Pro Tips
- Remember to add property taxes, homeowners insurance, and PMI (if down payment is less than 20%) to get your true monthly cost.
- A 15-year mortgage typically has a lower interest rate but much higher monthly payment—run the numbers to see if it fits your budget.
- Lock in your interest rate when you find a good deal; rates can fluctuate daily during the home buying process.