Mortgage Calculator Updated Nov 28, 2026

Use this free mortgage calculator to estimate your monthly mortgage payment in seconds. Enter the home price, down payment, loan term, and mortgage interest rate — the mortgage calculator instantly shows your principal and interest, total cost of the loan, and an optional payment breakdown including private mortgage insurance (PMI), property tax, homeowners insurance, and HOA fees.

How to use this mortgage calculator in 5 easy steps

This free mortgage calculator works in five quick steps and gives you an estimated mortgage payment in under a minute. You can use the mortgage calculator for a 30-year fixed-rate loan, a 15-year mortgage, or any term in between — and toggle on the extras to see your full PITI payment, not just principal and interest.

1. Enter the home price. The purchase price of the property you're considering.
2. Enter your down payment. Cash you'll put down at closing. A 20% down payment lets you avoid private mortgage insurance.
3. Pick your loan term. 30-year is the most common; 15-year cuts total interest dramatically but raises the monthly payment.
4. Type your interest rate. Use today's mortgage rate from your lender, or a current market estimate.
5. (Optional) Open the extras. Add property tax, homeowners insurance, PMI, and HOA fees to see the calculator estimate your full monthly payment.

Click Calculate payment and the mortgage calculator returns your principal and interest, total interest paid over the life of the loan, and a clean payment breakdown. Use the Copy button on the result panel to send the numbers to your clipboard.

How this mortgage calculator works: the monthly payment formula

Your core monthly mortgage payment covers principal and interest (P&I). It is calculated from three things: the loan amount (home price minus down payment), the interest rate, and the loan term. The standard amortization formula used by every fixed-rate mortgage lender — and explained in detail by Investopedia's amortization guide — is:

The monthly rate r is the annual rate divided by 12, and n is the number of years multiplied by 12. The math is fiddly by hand, which is why the mortgage calculator above does it instantly for any loan amount, rate, and term you enter.

What's included in your monthly mortgage payment (PITI)

Mortgage lenders often refer to "PITI" — the four parts of a full housing payment. The Consumer Financial Protection Bureau's Owning a Home resource is the official US guide that walks through every one of these:

• Principal — the portion of each monthly mortgage payment that pays down what you borrowed. Each payment shrinks the loan balance a little more.
• Interest — the mortgage lender's charge for the loan. Early in the life of the loan, most of your payment is interest, not principal.
• Taxes — property tax, usually collected monthly into an escrow account by your lender, then paid to the local government on your behalf.
• Insurance — homeowners insurance, plus private mortgage insurance (PMI) if your down payment is less than 20% of the purchase price.

HOA fees, if any, sit on top of PITI as a separate monthly charge. Toggle "Add property tax, insurance, PMI & HOA" in the mortgage calculator above to see your true total monthly cost — not just principal and interest.

30-year vs 15-year fixed-rate mortgage

The two most common mortgage terms in the US are the 30-year fixed-rate loan and the 15-year fixed-rate mortgage. The trade-off is simple: a longer loan term gives you a lower monthly payment but a much higher total cost of the loan.

Illustrative figures based on a $280,000 loan at 6.5%. Run your own numbers through the mortgage calculator above for exact monthly payment amounts.

Fixed-rate vs adjustable-rate mortgage

Beyond the loan term, the other big choice is loan type — fixed mortgage or adjustable-rate mortgage (ARM):

• Fixed-rate mortgage — the interest rate is locked for the life of the loan. Your monthly payment for principal and interest never changes. Best when rates are reasonable or expected to rise.
• Adjustable-rate mortgage (ARM) — the rate is fixed for an initial period (typically 5, 7, or 10 years), then adjusts periodically based on a market index. Common types: 5/1 ARM, 7/1 ARM, 10/1 ARM. Best when rates are high and expected to fall, or when you plan to sell or refinance before the adjustment.

This mortgage calculator works for the fixed-rate portion of either loan type. For an adjustable-rate mortgage, use the calculator with the initial fixed rate to see your payment during the intro period.

How much down payment do you need?

The classic answer is 20% of the home price — that lets you avoid private mortgage insurance and gives you instant equity. But the modern mortgage market is more flexible:

• 3–5% down — conventional loans backed by Fannie Mae or Freddie Mac. Lower barrier to entry but you'll pay PMI until you reach 20% equity.
• 3.5% down — FHA loans, often used by first-time homebuyers. Mortgage insurance applies but is structured differently than PMI.
• 0% down — VA loans (military) and USDA loans (rural). No down payment required for eligible borrowers.
• 20% down — the sweet spot. No PMI, lower monthly payment, and often a slightly lower interest rate from your mortgage lender.

If you're shopping at different down payment levels, Fannie Mae's HomeView education portal walks through the trade-offs in detail. Try a different down payment in the mortgage calculator to see how each changes your monthly mortgage payments.

Private mortgage insurance (PMI) explained

Private mortgage insurance is what most lenders require when your down payment is less than 20% of the home price. PMI protects the lender (not you) if you stop paying the loan. The cost of private mortgage insurance typically runs 0.3% to 1.5% of the loan amount per year, paid as part of your monthly mortgage payment.

On a $280,000 loan at 0.5% PMI, that's about $1,400 per year, or roughly $117 added to your monthly payment. You can:

• Avoid private mortgage insurance entirely by making a 20% or larger down payment.
• Drop PMI automatically once your loan balance reaches 78% of the original home value (federal law on most conventional loans).
• Request PMI removal when you reach 80% loan-to-value through extra payments or home appreciation.

To see the actual cost of private mortgage insurance for your loan, type an annual PMI amount into the mortgage calculator with PMI field above and recalculate.

Closing costs to budget for

The monthly mortgage payment isn't the only cost of buying a home — closing costs are due at signing and typically run 2% to 5% of the purchase price. On a $350,000 home, that's $7,000 to $17,500 on top of your down payment. Typical closing costs include:

• Loan origination fee (usually 0.5%–1% of the loan amount)
• Appraisal fee ($300–$700)
• Title insurance and title search
• Recording fees and transfer taxes
• Prepaid property tax and homeowners insurance (usually 2 months)
• First-year insurance premium
• Discount points (optional, to buy down the rate)

Combined with your down payment and closing costs, you'll typically need the down payment plus 2–5% of the home price in cash on closing day.

How to lower your monthly mortgage payment

• Make a larger down payment. Borrowing less directly cuts the payment and removes PMI once you cross 20% equity.
• Shop multiple mortgage lenders. A lower interest rate of even 0.5% can save tens of thousands over the life of the loan.
• Choose a longer loan term. A 30-year fixed-rate mortgage has lower monthly mortgage payments than a 15-year, though total interest is higher.
• Make extra payments toward principal. Even small extra payments shorten the loan and reduce total interest paid.
• Refinance to a lower rate. If rates drop significantly after you close, refinancing can lower your monthly mortgage payment.
• Look at payment assistance programs. Many state and federal programs offer down payment and closing cost assistance for first-time homebuyers.

Refinancing your mortgage

To refinance is to replace your existing mortgage loan with a new one — usually to get a lower interest rate, shorten the term, switch from an adjustable-rate to a fixed-rate mortgage, or tap home equity. A common rule of thumb is that refinancing makes sense when the new rate is at least 0.75–1% below your current rate and you plan to stay in the home long enough to recover the closing costs.

Run the new rate and term through the mortgage calculator above, then compare the new monthly payment and total interest against your current loan. If the savings clearly beat the closing costs of refinancing within a few years, the math usually works.

First-time homebuyer tips

If you're buying a home for the first time, the mortgage calculator is step one — but a few extra moves can save you thousands:

• Get pre-approved before you shop. A pre-approval letter from a lender tells you the loan amount you'll qualify for and makes your offer stronger.
• Look for first-time homebuyer programs. The US Department of Housing and Urban Development lists state-by-state programs at HUD's buying a home portal — many offer down payment assistance or below-market mortgage rates.
• Don't borrow your maximum. Just because the bank approves a $400,000 loan doesn't mean you should take it. Aim for a monthly mortgage payment of no more than 28% of your gross monthly income.
• Budget for the hidden costs. Property tax, homeowners insurance, maintenance, HOA fees, and utilities can add 1–2% of the home's value to your annual cost.

Why our mortgage calculator is accurate

This mortgage calculator uses the standard amortization formula that every fixed-rate mortgage lender in the US applies. Principal and interest are computed exactly the same way as on your loan statement, so the monthly payment estimate matches what you'll actually see from a lender — given the same home price, down payment, interest rate, and loan term. Current US mortgage rate benchmarks come from Freddie Mac's Primary Mortgage Market Survey, the industry-standard weekly rate index. The PMI, tax, and insurance estimates use national-average ranges and update with whatever annual figures you enter, so the calculator to estimate your monthly mortgage payment stays accurate for any region.

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This mortgage calculator provides estimates for general information only and is not financial advice from Anchor AI Tools. Actual loan terms, mortgage rates, taxes, and insurance vary — consult a licensed mortgage lender for an accurate quote before getting a mortgage or refinancing.