How to Use This Calculator
Our mortgage calculator helps you estimate your monthly home loan payments. Follow these simple steps to get accurate results:
- Enter your target home price - the total cost of the property you're considering
- Input your down payment amount - typically 10-20% of the home price, though this can vary
- Select your loan term - 30 years is the most common, but shorter terms save on interest
- Enter the current interest rate - check with multiple lenders to find the best rate
- Add property tax and insurance estimates - your real estate agent can provide local estimates
- Include HOA fees if applicable - common in condos and planned communities
- Click "Calculate Payment" to see your complete monthly payment breakdown
Understanding Your Mortgage Payment
Principal & Interest
This is the core of your mortgage payment. Principal is the amount borrowed, and interest is what the lender charges you to borrow that money. In the early years of your mortgage, more of your payment goes toward interest. Over time, more goes toward paying down the principal.
Property Tax
Property taxes are typically paid to your local government and are based on your home's assessed value. The annual amount is divided by 12 months. Many lenders collect this monthly as part of your mortgage payment and pay the tax bill on your behalf when it's due.
Home Insurance
Homeowners insurance protects your investment from damage, theft, and liability. Lenders require this coverage to protect their interest in the property. The annual premium is divided into monthly payments and often collected by your lender in an escrow account.
Total Monthly Payment
This is the complete amount you'll pay each month, combining all the components above. This is often referred to as PITI (Principal, Interest, Taxes, and Insurance), plus any HOA fees if applicable.
Mortgage Tips
- A larger down payment reduces your monthly payment and the total interest you'll pay over the life of the loan. It may also help you avoid private mortgage insurance (PMI).
- Shorter loan terms (like 15 or 20 years) mean higher monthly payments but significantly less total interest paid. You'll build equity faster and own your home sooner.
- Shop around for the best interest rates - even a difference of 0.5% can save you tens of thousands of dollars over the life of your loan. Compare offers from multiple lenders.
- Budget for additional costs beyond your mortgage payment, including maintenance, repairs, utilities, and potential homeowners association fees. A good rule of thumb is to set aside 1-2% of your home's value annually for maintenance.
- Consider getting pre-approved for a mortgage before house hunting. This shows sellers you're a serious buyer and helps you understand your budget.