Mortgage Calculator - Calculate Monthly Payments
Free mortgage calculator to determine monthly payments including principal, interest, taxes, and insurance for home loans and property purchases
Mortgage Calculator
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What is a Mortgage Calculator?
A mortgage calculator is a free financial tool that helps you calculate your complete monthly mortgage payment including principal, interest, taxes, and insurance (PITI). It determines the total monthly cost of homeownership.
This calculator helps with:
- Home purchases - Calculate monthly payments for property buying
- Refinancing - Compare new mortgage terms with current payments
- Budget planning - Determine affordable home price ranges
- Loan comparison - Compare different mortgage offers
- Investment analysis - Evaluate rental property cash flow
Mortgage Payment Components (PITI)
Your monthly mortgage payment includes four main components:
Principal
Amount that reduces your loan balance. Increases over time.
Interest
Cost of borrowing money. Decreases as principal is paid down.
Taxes
Property taxes paid to local government, held in escrow.
Insurance
Homeowners insurance protecting against property damage.
Types of Mortgages
Fixed-Rate Mortgage
Interest rate remains constant throughout the loan term. Predictable monthly payments.
Adjustable-Rate Mortgage (ARM)
Interest rate can change over time. Lower initial rates but payment uncertainty.
FHA Loans
Government-backed loans with lower down payment requirements (3.5%).
How to Use This Mortgage Calculator
Enter Home Price
Input the purchase price of the home you're considering (e.g., $300,000)
Enter Down Payment
Input the amount you plan to pay upfront (e.g., $60,000)
Enter Interest Rate
Input the annual interest rate offered by your lender (e.g., 4.5%)
Enter Loan Term
Specify loan duration in years (typically 15 or 30 years)
Add Property Costs
Enter annual property tax and home insurance amounts
Get Complete Results
View total monthly payment and cost breakdown
Benefits of Using Mortgage Calculator
- •Home Affordability: Determine what home price fits your budget before house hunting.
- •Payment Planning: Understand complete monthly housing costs including taxes and insurance.
- •Loan Shopping: Compare different mortgage offers and terms effectively.
- •Down Payment Impact: See how different down payment amounts affect monthly costs.
- •Total Cost Analysis: Understand the complete cost of homeownership over time.
Factors That Affect Your Mortgage Payment
1. Home Price & Down Payment
Higher home price or lower down payment = Higher monthly payment. 20% down avoids PMI.
2. Interest Rate
Higher interest rate = Higher payment. Even 0.25% difference significantly impacts costs.
3. Loan Term
30-year = Lower monthly payment but more total interest. 15-year = Higher payment, less interest.
4. Property Taxes & Insurance
Higher property values and insurance costs increase monthly payments significantly.
Frequently Asked Questions
Common questions about mortgage calculations and home buying
What is included in a mortgage payment?
A complete mortgage payment typically includes four components: Principal, Interest, Taxes, and Insurance (PITI). Principal reduces your loan balance, interest is the cost of borrowing, taxes are paid to local governments, and insurance protects against property damage.
How much house can I afford?
Lenders typically want your total housing payment to be no more than 28% of your gross monthly income. Your total debt payments should be no more than 36% of your income.
Should I put 20% down or less?
Putting 20% down avoids PMI and reduces your monthly payment. However, a smaller down payment allows you to buy sooner and keep more cash for emergencies.
What's better: 15-year or 30-year mortgage?
A 15-year mortgage has higher monthly payments but significantly less total interest. A 30-year mortgage has lower payments but more total interest. Choose based on your cash flow needs.
Does this include PMI and closing costs?
No, this calculator doesn't include PMI (required with less than 20% down) or closing costs (2-5% of home price). These additional costs should be factored into your budget separately.
How accurate are these calculations?
Very accurate for the basic mortgage payment. Actual costs may vary based on lender fees, local tax rates, and specific loan terms. Always consult with your lender for precise quotes.
What credit score do I need for a mortgage?
Most conventional loans require 620+ credit score. FHA loans may accept scores as low as 580 with 3.5% down, or 500 with 10% down. Higher scores typically qualify for better interest rates.
How do interest rates affect my payment?
Interest rates significantly impact both monthly payments and total loan cost. A 1% rate increase on a $300,000 loan adds approximately $150-180 to monthly payments and tens of thousands to total interest.