Mortgage Calculator

It is highly accurate for principal and interest, because it uses the same standard amortization formula lenders rely on — for identical inputs, the P&I figure will match a lender's quote. The total monthly payment is an estimate, since property taxes, homeowners insurance, PMI, and HOA dues vary by location and provider. As a rule of thumb, taxes and insurance together add roughly 1-2% of the home's value per year. For a precise figure, enter your actual tax rate and insurance quote in the advanced options, and confirm lender-specific costs like origination fees and points separately, as those are paid at closing rather than in the monthly payment.

It depends on your priorities. A 15-year mortgage carries higher monthly payments but a lower interest rate and far less total interest, so you build equity faster and own the home sooner. A 30-year mortgage has lower, more flexible payments that ease monthly cash flow but cost substantially more interest over the life of the loan. On a $300,000 loan, the 30-year option can cost tens of thousands of dollars more in interest than the 15-year. A popular compromise is to take the 30-year loan for flexibility while making extra principal payments when you can. Enter both terms above to compare your exact numbers.

A safe target is to keep your total monthly housing payment — principal, interest, taxes, and insurance — under 28% of your gross (pre-tax) monthly income, with all of your debts combined under 36%. This is the Consumer Financial Protection Bureau's widely cited 28/36 rule. For a household earning $100,000 per year, 28% works out to about $2,333 per month for housing. Lenders may approve you for more, but staying within these limits leaves room for maintenance, emergencies, and saving. Also budget for the down payment, closing costs (typically 2-5% of the price), and ongoing expenses like utilities and repairs that the loan payment alone doesn't include.

Private Mortgage Insurance (PMI) protects the lender if you default, and it is typically required on conventional loans when your down payment is less than 20%. It usually costs about 0.5-1% of the loan amount per year, added to your monthly payment. The benefit is that it lets you buy sooner without saving a full 20% deposit. PMI is not permanent: under the federal Homeowners Protection Act you can request cancellation once you reach 20% equity, and your lender must remove it automatically at 22% equity based on the original purchase price. A larger down payment or extra principal payments reduce or eliminate it.

Significantly, because interest compounds over decades. On a $300,000 loan over 30 years, moving from a 6% to a 7% rate raises the monthly payment by roughly $200 and adds more than $70,000 in total interest across the life of the loan. Even a quarter-point difference can be worth hundreds to thousands of dollars, which is why it pays to compare multiple lenders and improve your credit score before applying. A larger down payment, a shorter term, or buying discount points can each lower your effective rate — adjust the rate above to see the impact on your own numbers.