Mortgage Calculator

Calculate your monthly mortgage payment, total interest paid, and true all-in cost including taxes, insurance, and PMI. Every number updates instantly as you adjust the sliders.

What this calculator tells you

Most mortgage calculators show you one number: the monthly payment. This one shows the full financial picture -- monthly principal and interest (P&I), the true all-in monthly cost including taxes and insurance, a breakdown of what percentage goes to interest versus principal, and a complete amortization schedule. Understanding the difference between your P&I payment and your all-in payment is one of the most common areas where first-time buyers get surprised after closing.

How the monthly payment is calculated

Your principal and interest payment is derived from the standard amortization formula:

M = P x [r(1+r)^n] / [(1+r)^n - 1]

Where P is the loan amount, r is the monthly interest rate (annual rate divided by 12), and n is the total number of monthly payments. On a $400,000 loan at 7% for 30 years, this produces a monthly P&I payment of $2,661. The same payment is due every single month, but the split between interest and principal shifts continuously -- more goes to interest early in the loan, and more goes to principal later. This is called amortization front-loading, and it is the reason why paying extra in the early years has an outsized impact on your total cost.

Real-world example: The Martinez family

Consider a family purchasing a $450,000 home with 10% down at a 7% rate over 30 years. Their loan amount is $405,000. Their base P&I payment works out to $2,694 per month. But their true all-in monthly cost includes property taxes ($450/month at 1.2%), homeowners insurance ($150/month), and PMI of approximately $236/month because their down payment was under 20%. Their actual monthly housing cost is $3,530 -- 31% higher than the P&I payment alone. PMI cancels around year 7.5 when their balance drops to 80% of the original home value, at which point their all-in payment drops to $3,294.

Common mistakes when reading mortgage numbers

Budgeting from P&I only: Always calculate your true all-in cost before deciding what you can afford. Taxes and insurance can add $400 to $800 per month on a typical home purchase.

Ignoring total interest: A 30-year loan at 7% on a $400,000 balance costs about $558,000 in interest alone -- nearly as much as the original loan. The total amount paid is close to double the purchase price.

Comparing loans by monthly payment alone: A longer term always produces a lower monthly payment, but a 30-year loan costs dramatically more in total interest than a 15-year loan. Compare total cost paid, not just the monthly number.

Not shopping multiple lenders: A 0.5% difference in rate on a $400,000 mortgage is worth roughly $48,000 over 30 years. Getting quotes from three or more lenders takes a few hours and can save tens of thousands of dollars.

How to use this calculator

Enter your home price and adjust the down payment percentage. Your loan amount updates automatically. Set the interest rate to what you expect to qualify for -- check our credit score guide if you are unsure. Choose your loan term (30 years is the most common; 15 years costs less in total interest but requires a higher monthly payment). Add your estimated property tax rate, monthly insurance cost, and PMI rate if your down payment is under 20%. Every output updates in real time.

Frequently asked questions

How is a monthly mortgage payment calculated?

Your monthly P&I payment uses the amortization formula: M = P x [r(1+r)^n] / [(1+r)^n - 1], where P is the loan amount, r is the monthly rate (annual rate divided by 12), and n is total number of payments. Your all-in monthly cost also includes property taxes, homeowners insurance, and PMI if your down payment is under 20%.

What is the difference between interest rate and APR?

The interest rate is the base annual cost to borrow. APR (Annual Percentage Rate) includes the interest rate plus lender fees and points, expressing the true cost as a single number. Always compare APRs when shopping lenders -- a lower rate with high fees can cost more than a slightly higher rate with no fees.

How much does a 0.5% rate difference actually cost?

On a $400,000 30-year mortgage, a 0.5% rate difference changes your monthly payment by about $133 and your total interest by roughly $48,000. This is why shopping multiple lenders and improving your credit score before applying can be worth tens of thousands of dollars.

When does PMI go away?

PMI is required when your down payment is less than 20%. By law, lenders must automatically cancel PMI when your loan balance reaches 78% of the original home value. You can request cancellation at 80% LTV. FHA loans have different rules -- MIP is permanent for loans with less than 10% down.

What credit score do I need for a good mortgage rate?

Conventional loans typically require a minimum 620 credit score, but the best rates go to borrowers with 740 or higher. The difference between a 680 and 760 score on a $400,000 loan can translate to $40,000 to $80,000 in total interest over 30 years.

Is it better to put 20% down or invest the extra cash?

Putting 20% down eliminates PMI and reduces total interest. However, if your PMI cost is low and your investments historically return more than your mortgage rate, investing the difference can make sense. Most advisors suggest at least 20% to avoid PMI, then investing surplus rather than making extra mortgage payments.

What happens if I pay extra on my mortgage each month?

Extra payments go directly to reducing your principal balance, which reduces future interest accrual. On a $400,000 30-year loan at 7%, paying an extra $200/month saves approximately $127,000 in interest and cuts about 5 years and 10 months off the term. Earlier extra payments have a larger impact because interest is front-loaded.

How does property tax affect my monthly payment?

Property taxes are collected monthly through your escrow account. The national average is about 1.1% of home value annually, but rates range from 0.3% in Hawaii to over 2.5% in New Jersey. On a $400,000 home at the national average, taxes add roughly $367 per month on top of your P&I payment.

Calculations are estimates for educational purposes only and do not constitute financial advice. Actual loan terms, rates, and costs are determined by licensed lenders. Consult a licensed mortgage professional before making any financing decision.