Mortgage Calculator
Calculate monthly mortgage payments, total interest, and amortization. Home loan calculator with taxes & insurance.
Monthly payment (PITI)
What is a mortgage?
A mortgage is a loan specifically used to purchase real estate, where the property itself serves as collateral. If the borrower fails to make payments, the lender can foreclose on the home. Mortgages are the largest financial commitment most people make in their lifetime – typical home loans span 15-30 years with hundreds of thousands of dollars in principal plus often equal amount in total interest. In the United States, the most common is the 30-year fixed-rate mortgage, which provides predictable monthly payments and locks in the interest rate for the entire term. The mortgage calculator helps you understand the full monthly cost (PITI – Principal, Interest, Taxes, Insurance), the loan’s total interest cost, and how down payment, rate, and term affect what you can afford.
How to use this tool
- Enter home price — The full purchase price of the property. This is the agreed-upon sale price between you and the seller, before closing costs.
- Enter down payment — The cash you pay upfront. Aim for 20% to avoid PMI (Private Mortgage Insurance). On a $400,000 home, 20% = $80,000. FHA loans accept as little as 3.5% but require mortgage insurance.
- Enter interest rate — Your mortgage interest rate (APR). As of 2026, US 30-year rates typically range 6-8%. Shop multiple lenders – rate differences of 0.5% save tens of thousands over 30 years.
- Select loan term — 30 years for lowest monthly payment, 15 years for fastest payoff with much less total interest, 20 or 10 years as middle options.
- Add property tax and insurance — Annual amounts. Property tax is typically 0.5-2.5% of home value depending on state. Home insurance averages $1,200-2,400/year in the US. These are escrowed and divided into your monthly payment.
- Read monthly PITI — The big number is your full monthly payment. Stats show Principal & Interest portion, escrow for tax and insurance, total interest over loan life, and total amount you’ll pay.
Mortgage calculation formula
Monthly principal & interest payment uses the standard amortization formula:
M = P [r(1+r)n] / [(1+r)n – 1]
- M = Monthly payment (principal + interest only)
- P = Loan amount (home price – down payment)
- r = Monthly interest rate (annual rate / 12)
- n = Total months (years × 12)
Then add monthly escrow:
Monthly PITI = M + (Annual property tax / 12) + (Annual insurance / 12)
Example: $400,000 home, $80,000 down (20%), 6.5% rate, 30 years, $4,000/year tax, $1,200/year insurance:
- Loan amount = $320,000
- Monthly P&I = $320,000 [0.005417(1.005417)360] / [(1.005417)360 – 1] = $2,022
- Monthly tax = $4,000/12 = $333
- Monthly insurance = $1,200/12 = $100
- Total PITI = $2,455/month
- Total interest over 30 years = $407,759
Examples
- $400,000 home, 20% down, 6.5% / 30 years: $2,455 PITI/month, total interest $407K over 30 years
- Same home, 15-year mortgage at 6%: $3,094 PITI/month (more), but only $144K total interest ($263K saved!)
- $600,000 home, 10% down ($60K), 7% / 30 years: Loan = $540K, P&I = $3,593, plus PMI ~$280/month (because under 20% down), tax/ins escrow $700, total ~$4,573/month. PMI adds $3,360/year until you reach 20% equity.
- $250,000 home, 5% down (FHA), 6.5% / 30 years: Loan = $237,500, P&I = $1,500, FHA MIP $108, tax/ins $300, total ~$1,908/month
Tips & best practices
- Aim for housing costs (PITI + HOA) below 28% of gross monthly income – this is the ‘front-end debt ratio’ lenders look for
- Total debt payments (PITI + car + student + credit) should stay under 36% of gross income – ‘back-end ratio’
- Putting 20% down avoids PMI (Private Mortgage Insurance) which adds $100-300/month and provides no benefit to you – just protects the lender
- A 15-year mortgage saves enormous interest but the monthly payment is 25-30% higher than a 30-year – calculate before committing
- Shop mortgage rates from 3-5 lenders within a 14-day window – credit pulls in this period count as one inquiry on your credit report
- Improve your credit score before applying – going from 680 to 760 can reduce your rate by 0.5-1%, saving $50K+ over 30 years
- Factor in property tax variation by location – a $500K home in Texas (2% tax) costs $5,000+ more per year than the same home in Hawaii (0.3% tax)
Limitations & notes
This calculator estimates principal, interest, taxes, and insurance only. It does not include HOA fees, PMI for loans under 20% down, FHA MIP, closing costs (typically 2-5% of loan), home maintenance (budget 1-2% of home value per year), or appreciation/depreciation. Adjustable Rate Mortgages (ARMs) start with a teaser rate that adjusts later – this calculator assumes a fixed rate. For exact figures get a Loan Estimate (LE) document from your lender.
Frequently Asked Questions
What is PITI?
PITI stands for Principal, Interest, Taxes, Insurance – the four components of your total monthly mortgage payment. Lenders look at full PITI (not just P&I) when calculating debt-to-income ratios. Some loans also include PMI or HOA in this monthly figure.
How much down payment do I need?
Conventional loans: 5-20% minimum. 20% avoids PMI. FHA: 3.5%. VA: 0% for qualifying veterans. USDA Rural: 0% in eligible areas. While low down payment loans exist, they cost more long-term due to mortgage insurance and higher rates.
Should I choose a 15-year or 30-year mortgage?
15-year: 25-30% higher monthly payment but saves enormous interest. Best if you can comfortably afford the higher payment and want to be debt-free in 15 years. 30-year: lower monthly payment, more flexibility, but you pay 2-3x more total interest. Most Americans choose 30-year.
What is PMI and how do I avoid it?
PMI (Private Mortgage Insurance) is required when you put down less than 20%. It protects the lender (not you) and adds $100-300/month. Avoid it by putting 20% down. If you already have PMI, you can request its removal once you reach 20% equity, or it drops automatically at 22% equity.
Are mortgage rates negotiable?
Sometimes. You can pay ‘points’ (1 point = 1% of loan amount upfront) to buy down the rate by ~0.25%. Some lenders offer rate matching against competitors. Most negotiation power comes from having multiple Loan Estimates to compare – lenders will reduce fees to win your business.
What credit score do I need for a mortgage?
Minimum scores: Conventional 620, FHA 580 (with 3.5% down) or 500 (with 10% down), VA no official minimum but most lenders require 580-620, USDA 640. Best rates require 760+. Each 20-point band typically improves your rate by 0.125-0.25%.
Should I include taxes and insurance in the calculator?
Yes – PITI is your real cost. The bank may also require an escrow account where they collect monthly amounts and pay your tax/insurance annually. This protects them (and you) from missed payments. Some loans allow you to waive escrow with a higher rate or fee, then you pay tax/insurance directly twice a year.
Related tools
EMI Calculator · Loan Calculator · Compound Interest Calculator · ROI Calculator
What is a mortgage?
A mortgage is a loan specifically used to purchase real estate, where the property itself serves as collateral. If the borrower fails to make payments, the lender can foreclose on the home. Mortgages are the largest financial commitment most people make in their lifetime – typical home loans span 15-30 years with hundreds of thousands of dollars in principal plus often equal amount in total interest. In the United States, the most common is the 30-year fixed-rate mortgage, which provides predictable monthly payments and locks in the interest rate for the entire term. The mortgage calculator helps you understand the full monthly cost (PITI – Principal, Interest, Taxes, Insurance), the loan’s total interest cost, and how down payment, rate, and term affect what you can afford.
How to use this tool
- Enter home price — The full purchase price of the property. This is the agreed-upon sale price between you and the seller, before closing costs.
- Enter down payment — The cash you pay upfront. Aim for 20% to avoid PMI (Private Mortgage Insurance). On a $400,000 home, 20% = $80,000. FHA loans accept as little as 3.5% but require mortgage insurance.
- Enter interest rate — Your mortgage interest rate (APR). As of 2026, US 30-year rates typically range 6-8%. Shop multiple lenders – rate differences of 0.5% save tens of thousands over 30 years.
- Select loan term — 30 years for lowest monthly payment, 15 years for fastest payoff with much less total interest, 20 or 10 years as middle options.
- Add property tax and insurance — Annual amounts. Property tax is typically 0.5-2.5% of home value depending on state. Home insurance averages $1,200-2,400/year in the US. These are escrowed and divided into your monthly payment.
- Read monthly PITI — The big number is your full monthly payment. Stats show Principal & Interest portion, escrow for tax and insurance, total interest over loan life, and total amount you’ll pay.
Mortgage calculation formula
Monthly principal & interest payment uses the standard amortization formula:
M = P [r(1+r)n] / [(1+r)n – 1]
- M = Monthly payment (principal + interest only)
- P = Loan amount (home price – down payment)
- r = Monthly interest rate (annual rate / 12)
- n = Total months (years × 12)
Then add monthly escrow:
Monthly PITI = M + (Annual property tax / 12) + (Annual insurance / 12)
Example: $400,000 home, $80,000 down (20%), 6.5% rate, 30 years, $4,000/year tax, $1,200/year insurance:
- Loan amount = $320,000
- Monthly P&I = $320,000 [0.005417(1.005417)360] / [(1.005417)360 – 1] = $2,022
- Monthly tax = $4,000/12 = $333
- Monthly insurance = $1,200/12 = $100
- Total PITI = $2,455/month
- Total interest over 30 years = $407,759
Examples
- $400,000 home, 20% down, 6.5% / 30 years: $2,455 PITI/month, total interest $407K over 30 years
- Same home, 15-year mortgage at 6%: $3,094 PITI/month (more), but only $144K total interest ($263K saved!)
- $600,000 home, 10% down ($60K), 7% / 30 years: Loan = $540K, P&I = $3,593, plus PMI ~$280/month (because under 20% down), tax/ins escrow $700, total ~$4,573/month. PMI adds $3,360/year until you reach 20% equity.
- $250,000 home, 5% down (FHA), 6.5% / 30 years: Loan = $237,500, P&I = $1,500, FHA MIP $108, tax/ins $300, total ~$1,908/month
Tips & best practices
- Aim for housing costs (PITI + HOA) below 28% of gross monthly income – this is the ‘front-end debt ratio’ lenders look for
- Total debt payments (PITI + car + student + credit) should stay under 36% of gross income – ‘back-end ratio’
- Putting 20% down avoids PMI (Private Mortgage Insurance) which adds $100-300/month and provides no benefit to you – just protects the lender
- A 15-year mortgage saves enormous interest but the monthly payment is 25-30% higher than a 30-year – calculate before committing
- Shop mortgage rates from 3-5 lenders within a 14-day window – credit pulls in this period count as one inquiry on your credit report
- Improve your credit score before applying – going from 680 to 760 can reduce your rate by 0.5-1%, saving $50K+ over 30 years
- Factor in property tax variation by location – a $500K home in Texas (2% tax) costs $5,000+ more per year than the same home in Hawaii (0.3% tax)
Limitations & notes
This calculator estimates principal, interest, taxes, and insurance only. It does not include HOA fees, PMI for loans under 20% down, FHA MIP, closing costs (typically 2-5% of loan), home maintenance (budget 1-2% of home value per year), or appreciation/depreciation. Adjustable Rate Mortgages (ARMs) start with a teaser rate that adjusts later – this calculator assumes a fixed rate. For exact figures get a Loan Estimate (LE) document from your lender.
Frequently Asked Questions
What is PITI?
PITI stands for Principal, Interest, Taxes, Insurance – the four components of your total monthly mortgage payment. Lenders look at full PITI (not just P&I) when calculating debt-to-income ratios. Some loans also include PMI or HOA in this monthly figure.
How much down payment do I need?
Conventional loans: 5-20% minimum. 20% avoids PMI. FHA: 3.5%. VA: 0% for qualifying veterans. USDA Rural: 0% in eligible areas. While low down payment loans exist, they cost more long-term due to mortgage insurance and higher rates.
Should I choose a 15-year or 30-year mortgage?
15-year: 25-30% higher monthly payment but saves enormous interest. Best if you can comfortably afford the higher payment and want to be debt-free in 15 years. 30-year: lower monthly payment, more flexibility, but you pay 2-3x more total interest. Most Americans choose 30-year.
What is PMI and how do I avoid it?
PMI (Private Mortgage Insurance) is required when you put down less than 20%. It protects the lender (not you) and adds $100-300/month. Avoid it by putting 20% down. If you already have PMI, you can request its removal once you reach 20% equity, or it drops automatically at 22% equity.
Are mortgage rates negotiable?
Sometimes. You can pay ‘points’ (1 point = 1% of loan amount upfront) to buy down the rate by ~0.25%. Some lenders offer rate matching against competitors. Most negotiation power comes from having multiple Loan Estimates to compare – lenders will reduce fees to win your business.
What credit score do I need for a mortgage?
Minimum scores: Conventional 620, FHA 580 (with 3.5% down) or 500 (with 10% down), VA no official minimum but most lenders require 580-620, USDA 640. Best rates require 760+. Each 20-point band typically improves your rate by 0.125-0.25%.
Should I include taxes and insurance in the calculator?
Yes – PITI is your real cost. The bank may also require an escrow account where they collect monthly amounts and pay your tax/insurance annually. This protects them (and you) from missed payments. Some loans allow you to waive escrow with a higher rate or fee, then you pay tax/insurance directly twice a year.
Related tools
EMI Calculator · Loan Calculator · Compound Interest Calculator · ROI Calculator