Mortgage Payment Calculator
Calculate your monthly mortgage payment including principal and interest based on loan amount, interest rate, and loan term.
Results
Visualization
How It Works
A mortgage payment calculator helps you determine how much you will pay each month for your home loan. Your monthly payment consists of principal (the amount that reduces your loan balance) and interest (the cost of borrowing). Understanding this breakdown helps you budget accurately and compare loan offers.
The Formula
Variables
- M — Monthly mortgage payment (principal and interest)
- P — Principal loan amount (the amount borrowed)
- r — Monthly interest rate (annual rate divided by 12)
- n — Total number of monthly payments (years times 12)
Worked Example
For a $300,000 loan at 6.5% for 30 years: r = 0.065/12 = 0.005417, n = 360. M = 300000 x [0.005417 x (1.005417)^360] / [(1.005417)^360 - 1] = $1,896.20 per month. Total paid over 30 years is $682,633, meaning you pay $382,633 in interest.
Practical Tips
- A 15-year mortgage has higher monthly payments but saves tens of thousands in total interest compared to a 30-year term.
- Even small rate differences matter: 0.25% on a $300,000 loan changes your payment by about $45/month and $16,000 in total interest.
- Your actual monthly housing cost will also include property taxes, homeowners insurance, and possibly PMI or HOA dues.
- Making one extra payment per year can shave 4-5 years off a 30-year mortgage.
- Compare APR (not just the interest rate) when shopping lenders, because APR includes fees and points.
Frequently Asked Questions
What is included in a mortgage payment?
A basic mortgage payment includes principal and interest (P&I). Your full monthly housing payment often also includes property taxes, homeowners insurance, and PMI if applicable. This is called PITI (Principal, Interest, Taxes, Insurance).
How does the interest rate affect my payment?
Higher rates increase your monthly payment and total interest. For example, on a $300,000 30-year loan, going from 6% to 7% increases your payment by about $200/month and adds roughly $72,000 in total interest.
Should I choose a 15-year or 30-year mortgage?
A 15-year mortgage has higher monthly payments but a lower interest rate and far less total interest. Choose 15 years if you can comfortably afford the higher payments; otherwise, a 30-year loan with extra payments offers flexibility.
What is amortization?
Amortization is the process of paying off a loan over time with fixed payments. Early payments are mostly interest; later payments are mostly principal. An amortization schedule shows this breakdown for each payment.
Can I lower my mortgage payment?
You can lower payments by refinancing to a lower rate, extending the loan term, making a larger down payment, or eliminating PMI once you reach 20% equity.