Mortgage calculator
Free mortgage calculator. See your monthly payment, total interest paid, and how much you'd save with extra monthly payments — instantly.
Key mortgage terms (used throughout this page)
- PITI
- Principal + Interest + Taxes + Insurance. The four components of full housing cost. Our calc shows P&I; add taxes/ins for true monthly cost.
- Amortization
- How each payment splits between interest and principal. Year 1 is mostly interest; year 30 mostly principal.
- PMI
- Private Mortgage Insurance. Required if down payment < 20%. ~0.5-1.5% of loan annually until 80% LTV is reached.
- LTV
- Loan-to-Value ratio = loan balance ÷ home value. 80% is the PMI removal threshold; 80%+ also tightens refinance eligibility.
- DTI
- Debt-to-Income. Total monthly debt ÷ gross income. Conv. cap 36% back-end; FHA up to 43%; rarely beyond 50%.
- Points
- Prepaid interest. 1 point = 1% of loan paid upfront to drop the rate ~0.25%. Worth it if you'll keep the loan long enough to break even (typically 5+ years).
How is a mortgage payment calculated?
A monthly mortgage payment is calculated with the formula M = P × [r(1+r)n] / [(1+r)n − 1], where P is the loan principal, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of monthly payments (years × 12). For a $300,000 loan at 6.5% over 30 years, the monthly principal-and-interest payment is about $1,896. Property tax, homeowners insurance, and HOA fees are added separately.
How mortgage payments work
A mortgage payment is calculated using the amortization formula. Early payments are mostly interest; later payments are mostly principal. On a $300,000 mortgage at 6.5% for 30 years:
- Year 1: ~$19,400 goes to interest, only $3,350 to principal
- Year 15: split roughly 50/50
- Year 30: almost entirely principal
This is why extra payments early in the loan are dramatically more valuable than extra payments late. An extra $100 in year 1 reduces the principal that all future interest is calculated on for 29 more years.
Extra payment impact (on a $300k, 6.5%, 30-year mortgage)
- $0 extra: $682,633 total paid, $382,633 in interest
- $100/month extra: $621,639 total paid; saves $60,995 and 48 months
- $200/month extra: $579,185 total paid; saves $103,449 and 83 months
- $500/month extra: $502,874 total paid; saves $179,759 and 150 months
- $1,000/month extra: $441,471 total paid; saves $241,162 and 207 months
Rounded to the nearest dollar. Fixed rate, monthly payments, extra principal paid from month one, and no fees or prepayment penalties. The final payment is reduced to the amount owed.
30-year vs 15-year mortgage
Same $300,000 loan at two illustrative fixed rates:
- 30-year at 6.5%: $1,896/month, $382,633 total interest
- 15-year at 5.75%: $2,492/month, $148,587 total interest
15-year saves $234,000 in interest but costs $596/month more. If you can afford the higher payment, 15-year wins. If cash flow is tight, 30-year with aggressive extra payments is often optimal — you get 80% of the savings with 100% of the flexibility.
Beyond P&I: the full cost of home ownership
Your mortgage payment isn't the full cost. Budget for:
- Property tax: 0.5-2.5% of home value annually, varies dramatically by state (TX, IL, NJ are highest)
- Homeowners insurance: $1,200-$2,500/year depending on location and coverage
- PMI: if you put less than 20% down, ~0.5-1% of loan annually until equity hits 20%
- HOA: $100-$500/month if applicable
- Maintenance: budget 1-2% of home value per year (often ignored, always hits)
A $1,896 mortgage payment is often $2,500-$3,000+ in actual monthly housing cost.
Should I pay off my mortgage early or invest?
Depends on your mortgage rate:
- Rate under 5%: investing may be attractive if your after-tax expected return justifies the market risk and you can keep the cash available
- Rate 5-7%: compare a known interest saving with after-tax expected returns, fees, risk and liquidity; a split can be reasonable
- Rate 7%+: paying down the loan becomes more compelling, but check prepayment rules and your emergency reserve
There's also a behavioral argument: paid-off mortgage = psychological freedom. Some choose payoff even when math favors investing.
Mortgage rate snapshot: 2026-10-01
- 30-year fixed: 7.28%. Freddie Mac PMMS weekly average; conventional conforming purchase applications.
- 15-year fixed: 6.60%. Freddie Mac PMMS weekly average; conventional conforming purchase applications.
Source: Freddie Mac Primary Mortgage Market Survey, week ending 2026-10-01; reviewed 2026-10-04. These are national weekly averages for conventional conforming purchase applications, not APRs or a personal loan offer. Your quoted rate and fees may differ.
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Methodology & sources
- Amortization formula: standard annuity present-value (M = P × r(1+r)^n / [(1+r)^n − 1])
- 30-yr / 15-yr / ARM rate averages: Freddie Mac Primary Mortgage Market Survey (PMMS), weekly
- Conforming loan limits: FHFA 2026 Conforming Loan Limit notice
- Median home price & down payment: NAR Existing-Home Sales + Profile of Home Buyers and Sellers
- FHA/VA underwriting rules: HUD Handbook 4000.1, VA Lenders Handbook
- PMI guidelines: Homeowners Protection Act of 1998
- Property tax averages: Tax Foundation state-level effective rates