About the Mortgage
A mortgage calculator turns a home price, a term, and an interest rate into the one number that actually decides whether you can buy the house: the monthly payment. It uses the standard amortising loan formula, the same one your lender uses, so the principal-and-interest figure it returns should match a quote closely for the same three inputs.
The formula
M = P · [ r(1 + r)ⁿ ] / [ (1 + r)ⁿ − 1 ]M is the monthly payment, P is the amount borrowed, r is the monthly interest rate (the annual rate divided by 12), and n is the total number of monthly payments — 360 for a 30-year loan.
How to use this calculator
- 1Enter your Loan Amount ($). The field starts at
300000, which you can overwrite. - 2Enter your Loan Term (Years). The field starts at
30, which you can overwrite. - 3Enter your Interest Rate (%). The field starts at
6.5, which you can overwrite. - 4Read the result straight away — it recalculates as you type, so there is no button to press. Use Share to copy a link that reopens the page with your exact numbers filled in.
Worked example
| Input | Value |
|---|---|
| Loan Amount ($) | 300000 |
| Loan Term (Years) | 30 |
| Interest Rate (%) | 6.5 |
Result
Monthly Payment: $1896.20
Those are the values the page loads with, so you can reproduce this result yourself and then change one field at a time to see what drives the outcome.
Understanding your result
The payment stays flat for the life of the loan, but its composition does not. In the first years almost all of it is interest, because interest is charged on a balance that is still nearly the full loan amount. As the balance falls, the interest share shrinks and the principal share grows, which is why the last years of a mortgage pay down the balance so much faster than the first.
The rate matters more than most buyers expect. On a 30-year loan, each additional percentage point adds roughly 10 percent to the monthly payment, and because it is charged over three decades it can add more in total interest than the size of the original deposit. Shortening the term has the opposite effect: it raises the monthly payment but cuts total interest sharply.
Things worth knowing
- This figure is principal and interest only. Property tax, home insurance, mortgage insurance, and any HOA or service charge are billed on top, and together they often add 20 to 30 percent to what actually leaves your account each month.
- Lenders qualify you on the total housing payment including those extras, not on principal and interest alone, so budget against the higher number.
- Enter the amount you are borrowing, not the purchase price. If you are putting down a deposit, subtract it first.
- A rate quote is only meaningful with its fees attached. Two loans at the same rate can cost different amounts once origination and discount points are counted — compare the APR instead.
Frequently asked questions
Why is my lender quote higher than this calculator?+
Almost always because the quote bundles in escrow items this calculator deliberately excludes: property tax, homeowners insurance, and mortgage insurance if your deposit is under 20 percent. Compare like with like by asking your lender for the principal-and-interest portion alone.
Should I choose a 15-year or a 30-year mortgage?+
A 15-year loan usually carries a lower rate and costs far less in total interest, but the monthly payment is roughly 40 to 50 percent higher. Run both terms here. If the 15-year payment leaves no room for emergencies or retirement saving, the 30-year is the safer choice.
How much deposit do I actually need?+
Twenty percent is the threshold that avoids private mortgage insurance in the US, but conventional loans start around 3 percent, FHA at 3.5 percent, and VA loans at zero for eligible veterans. A smaller deposit means a larger loan, a higher payment, and insurance premiums until you build enough equity.
Does making one extra payment a year really help?+
Yes, substantially. Because every extra dollar goes straight to principal, it stops accruing interest for the remaining decades of the loan. One additional monthly payment per year typically retires a 30-year mortgage four to five years early.