Mortgage Calculator
Analyze home affordability and payment schedules
Best for: Comparing different loan terms before buying a home, seeing how down payment affects monthly costs, and understanding total interest over the loan's life.
Monthly Breakdown
Mortgage Amortization
🎥 How It Works
How to use the Mortgage Calculator
This is a full PITI mortgage calculator: Principal, Interest, property Tax, and Insurance — the four components that make up most homeowners’ true monthly housing cost. Use it to test affordability before you make an offer.
Step by step
- Home price — the sticker price you’re negotiating.
- Down payment — cash you’ll put in upfront. Anything below ~20% usually triggers PMI/insurance on top.
- Loan term — typically 15, 20, or 30 years.
- Interest rate — the rate the lender quotes. Re-run with +/- 0.5% to stress-test rate moves.
- Property tax rate and insurance — annual figures.
The output breaks the monthly payment into P, I, T, and I components, shows total interest over the life of the loan, and builds an amortization schedule you can export.
Why it’s important
Most buyers focus on “what EMI can I afford?” and ignore property tax and insurance — but those can add 20–30% to the monthly payment. A $2,000 “mortgage” can easily turn into $2,500 true cost once T and I are layered on. Affordability should be judged against the full PITI number, not the loan payment alone.
Worked examples
Always add closing costs, HOA fees, and expected maintenance (often ~1% of home value per year) to the picture before deciding what you can truly afford.
Real-life scenario: refinancing & comparing total home cost
A young couple finds their dream home at $420,000 and qualifies for a 30-year loan at 7.3%. The P&I of $2,310 fits their budget. Two years later, rates drop to 5.8% and they run the calculator again: a new P&I of $1,973 saves $337 per month, about $121,000 over the remaining 28 years — and even after $4,000 in closing costs, the refinance pays for itself inside twelve months.
For buyers, another common scenario is comparing the full PITI on two different homes where the cheaper sticker price carries much higher property tax. The mortgage calculator shows how a $380,000 house at 2.3% property tax can cost more each month than a $420,000 house at 0.8% — completely flipping the intuition of “this one is cheaper.” Run both through the tool before you make an offer.
How the math works: PITI and total cost of ownership
The monthly mortgage payment has four parts — the “PITI” that most US lenders quote:
PITI = P&I + Property tax/12 + Homeowners insurance/12 + HOA (if any)
where P&I is calculated with the standard amortization formula:
P&I = P × r × (1 + r)n / ((1 + r)n − 1)
with P = loan amount, r = monthly rate, n = total months.
Worked example. A $420,000 home, 20% down ($84,000), 30-year fixed at 7.3%. Loan is $336,000; monthly rate 0.006083; n = 360. P&I = 336000 × 0.006083 × (1.006083)360 / ((1.006083)360 − 1) ≈ $2,310. With property tax at 1.1% ($385/month), insurance $110/month, and no HOA, PITI is about $2,805 — the number lenders actually compare against income for the debt-to-income ratio.
Over 30 years, total P&I paid is $2,310 × 360 = $831,600, so $495,600 is interest alone — more than the price of the house itself. Refinance at 5.8% and the new P&I drops to about $1,973; even with $4,000 in closing costs the breakeven is under 12 months and lifetime savings exceed $120,000. The calculator runs both numbers side by side so the tradeoff is explicit.
Frequently asked questions
What debt-to-income ratio do lenders want?
US lenders typically cap housing PITI at 28% of gross monthly income (front-end DTI) and total debt at 36-43% (back-end DTI). FHA loans can stretch to 50% in some cases. A lower DTI improves both approval odds and the interest rate you are offered.
Should I put down 20%?
20% avoids PMI (private mortgage insurance) on a conventional US loan and generally gets the best rate. Putting down less is still rational if it preserves an emergency fund or if the home’s expected appreciation clearly exceeds the PMI cost. Never empty liquid savings just to hit 20%.
When does a refinance make sense?
The classic rule: refinance when the new rate is at least 1 percentage point lower and you plan to stay in the home long enough to recoup closing costs. Divide total closing costs by the monthly savings to get the break-even in months — if you will stay past that, the refinance pays off.
Is the property tax rate the same everywhere?
No — US property tax rates vary roughly 0.3% to 2.3% across states, and within states by county. A $400,000 home can cost $100/month in property tax in Hawaii or $750/month in New Jersey. Always look up the actual rate for the specific ZIP code before comparing two homes.