Mortgage Calculator
Calculate your monthly mortgage payment with ease. Simply enter your home price, down payment, interest rate, and other details to get an accurate estimate.
Enter Your Details
Property tax rates are state-level effective averages from Tax Foundation (June 2026). County and city rates may differ.
Your Monthly Payment
$2,670.82
Over 30 years
Payment Breakdown
Total Cost Over Loan Term
Understanding Mortgages: A Comprehensive Guide
Principal
The amount of money you borrow to purchase the home. This is the home price minus your down payment. For example, if you buy a $400,000 home with an $80,000 down payment, your principal is $320,000.
Interest
The cost of borrowing money from the lender. It's calculated as a percentage of the loan amount. A 7.5% interest rate on $320,000 means you'll pay interest on that balance each month.
Loan Term
The length of time you have to repay the loan. Common terms are 15, 20, and 30 years. A longer term means lower monthly payments but more total interest paid over time.
How Your Payment is Calculated
Your monthly mortgage payment is calculated using a standard formula that takes into account the principal amount, interest rate, and loan term. The formula ensures that each payment covers both principal and interest, with the proportion shifting over time.
M = P [ i(1 + i)^n ] / [ (1 + i)^n - 1 ]
Variables Explained:
M = Monthly payment
P = Principal loan amount
i = Monthly interest rate (annual rate / 12)
n = Number of payments (loan term in months)
Important Considerations
- •Mortgage rates change daily based on market conditions. Always verify current rates with multiple lenders.
- •Your actual payment may vary based on closing costs, points, and other fees not included in this calculator.
- •Property taxes and insurance costs can increase over time, affecting your monthly payment.
- •This calculator is for educational purposes only and does not constitute financial advice.
Example Calculation
Let's walk through a realistic example to see how our mortgage calculator works. Suppose you're buying a home worth $400,000 with the following parameters:
Input Parameters
- Home Price: $400,000
- Down Payment: $80,000 (20%)
- Interest Rate: 7.50%
- Loan Term: 30 years
- Property Tax Rate: 1.00%
- Annual Insurance: $1,200
Calculation Steps
- 1. Loan amount = $400,000 - $80,000 = $320,000
- 2. Monthly interest rate = 7.5% / 12 = 0.6250%
- 3. Number of payments = 30 * 12 = 360 months
- 4. Monthly P&I = $$2,237.49
- 5. Monthly tax = $$333.33
- 6. Monthly insurance = $$100.00
Total Monthly Payment: $2,670.82
Total Interest Over 30 Years: $641,495.11
Property Tax Data Sources
Rates shown are state-level effective property tax rates — the average percentage of home value paid annually in property taxes. When you select a state, we pre-fill this rate into the calculator. County, city, and school-district rates can differ significantly within the same state.
- Tax Foundation — Primary source for state effective property tax rates, based on U.S. Census Bureau property tax collections and housing value data.
- U.S. Census Bureau — American Community Survey — Underlying housing value and property tax data used by researchers and policy organizations to compute effective rates.
- National Association of Realtors (NAR) — Cross-referenced for regional housing cost context; local assessor offices remain the authoritative source for your exact rate.
Data last reviewed: June 2026
These figures are estimates for educational and planning purposes only — not tax or legal advice. Your actual property tax depends on assessed value, exemptions, and local mill rates. Consult your county assessor or a tax professional for precise figures.
Mortgage Terms to Know
APR
Annual Percentage Rate - includes interest rate plus certain fees, giving a more accurate picture of the loan cost.
ARM
Adjustable Rate Mortgage - has a fixed rate for an initial period, then adjusts based on market indices.
Fixed Rate
Interest rate remains the same for the entire loan term, providing predictable payments.
Conventional Loan
A mortgage not backed by a government agency like FHA, VA, or USDA.
FHA Loan
Mortgage insured by the Federal Housing Administration, often with lower down payment requirements.
VA Loan
Mortgage for eligible veterans and active-duty military members, often with no down payment.
Points
Fees paid upfront to reduce the interest rate, typically 1 point = 1% of the loan amount.
Closing Costs
Fees and expenses paid at closing, typically 2-5% of the purchase price.
Equity
The difference between the home's value and the remaining loan balance.
Frequently Asked Questions
What is included in my monthly mortgage payment?
Your monthly mortgage payment typically includes four components: principal (the amount borrowed), interest (the cost of borrowing), property taxes (paid to local government), and insurance (homeowners insurance and possibly PMI). This is often referred to as PITI - Principal, Interest, Taxes, and Insurance.
What is PMI?
PMI stands for Private Mortgage Insurance. It is required when you make a down payment of less than 20% of the home price. PMI protects the lender in case you default on the loan. PMI typically costs between 0.5% to 1% of the loan amount annually and is added to your monthly payment.
How does the loan term affect my payment?
A longer loan term (like 30 years) results in lower monthly payments but higher total interest paid over the life of the loan. A shorter term (like 15 years) has higher monthly payments but saves you thousands in interest. For example, a 30-year mortgage on $300,000 at 7% interest would cost about $1,996/month with $418,560 in total interest, while a 15-year mortgage would cost $2,696/month but only $185,280 in interest.
What is a good interest rate?
Interest rates vary based on market conditions, your credit score, and the type of loan. Generally, rates below 7% are considered favorable for a 30-year fixed mortgage. However, "good" is relative - what matters most is the rate you can qualify for based on your credit profile, down payment, and debt-to-income ratio.
Can I pay off my mortgage early?
Yes, most mortgages allow you to make extra payments or pay off the loan early without penalty. This can save you significant interest over the life of the loan. Before making extra payments, check your loan agreement for any prepayment penalties and consider whether you might earn a higher return by investing the money elsewhere.
What is the difference between fixed and adjustable rate mortgages?
A fixed-rate mortgage has an interest rate that remains the same for the entire loan term, providing predictable monthly payments. An adjustable-rate mortgage (ARM) has a fixed rate for an initial period (typically 3, 5, 7, or 10 years) and then adjusts periodically based on market indices. ARMs often start with lower rates but carry the risk of rate increases in the future.
How much down payment do I need?
The minimum down payment varies by loan type. Conventional loans typically require 3-5%, FHA loans require 3.5%, VA loans (for veterans) require 0%, and USDA loans require 0% for eligible properties. However, putting down 20% or more avoids PMI and gives you instant equity.
What credit score do I need for a mortgage?
Most conventional loans require a credit score of at least 620. FHA loans may accept scores as low as 580 with a 3.5% down payment, or 500-579 with a 10% down payment. Higher credit scores qualify you for better interest rates, potentially saving you thousands over the life of the loan.
What is debt-to-income ratio?
Debt-to-income ratio (DTI) is the percentage of your monthly income that goes toward paying debts. Lenders typically look for a DTI of 43% or lower, though some programs allow higher ratios with compensating factors. To calculate DTI, divide your total monthly debt payments by your gross monthly income.
What is escrow?
Escrow is an account held by your lender to pay property taxes and insurance. Each month, a portion of your mortgage payment goes into escrow, and the lender pays these bills when they come due. This ensures taxes and insurance are paid on time and prevents large lump-sum payments.
Disclaimer: This mortgage calculator is for educational purposes only and should not be considered financial advice. The calculations are estimates based on the information you provide and do not reflect actual loan terms from any specific lender.
Information is for educational purposes only. Always consult with a qualified mortgage professional before making financial decisions.