Mortgage Calculator

Calculate home loans, factor in PMI thresholds, property taxes, insurance, HOA fees, and model prepayment acceleration.

Amortized mortgages and property taxes

Mortgage calculators organize home payments across PITI components: Principal, Interest, Taxes, and Insurance.

Model extra monthly prepayments to bypass long compounding intervals and reduce overall interest charges.

Built and maintained by Meet Shah · Last updated 19 July 2026

What this tool is used for

Estimating a monthly payment before speaking to a lender.
Seeing how much of an early payment is interest rather than principal.
Comparing two terms on total interest paid.
Working out the effect of a larger deposit on the payment.
Checking a lender's quoted payment against the arithmetic.

How it works in practice

A worked example

A $350,000 purchase with $70,000 down needs a monthly figure that includes everything, not just the loan payment.

Input

Price          350,000
Down payment    70,000   (20.0%)
Rate               6.5%
Term            30 years
Property tax     3,500 / year
Insurance        1,200 / year
PMI rate           0.5%

Output

TOTAL MONTHLY PAYMENT
$2,161.46

PAYMENT BREAKDOWN
  P&I:        $1,769.79
  Taxes:        $291.67
  Insurance:    $100.00

PMI Thresholds: Private Mortgage Insurance (PMI) is usually required
if the down payment represents less than 20% of the purchase value.

The loan payment is four fifths of the monthly figure and the rest is the part people forget when they compare a rate. Tax and insurance are annual amounts divided by twelve, and they do not shrink as the balance does — in twenty years they will still be there, probably larger. There is no mortgage insurance line because the deposit is exactly twenty percent. Add up the interest column of the amortization schedule underneath and it comes to 357,124.57 on 280,000 borrowed, so the house costs over 637,000 to buy.

The edge case that catches people

The deposit here is exactly twenty percent, and that is why the mortgage insurance line reads zero. The test is a strict comparison, so a deposit one dollar short switches the charge on and adds it to every month of the schedule — a cliff rather than a slope. Worth knowing in the other direction too: this model keeps that charge for the whole term, whereas a real lender drops it once the balance falls far enough, so for a low deposit the lifetime figure here is pessimistic rather than optimistic.

When not to use this tool

It prices a loan; it does not tell you whether you can have one or should want one. Nothing here knows about closing costs, survey and legal fees, the deposit you will not have left afterwards, or the maintenance a first year of ownership tends to produce. A fixed rate is assumed for the full term, so anything that resets — a tracker, a two-year fix, an adjustable — is being modelled as something it is not, and the monthly figure will change on a date this calculator has no field for. Take the payment as a floor and not an estimate.

Frequently Asked Questions

What formula is used for the monthly payment?: The standard amortisation formula M = P × [r(1+r)^n] / [(1+r)^n − 1], where r is the MONTHLY rate (annual ÷ 12) and n is the total number of payments. Using the annual rate directly is the most common error and inflates the payment enormously.
Why is so much of an early payment interest?: Interest is charged on the outstanding balance, which is near its maximum at the start. On a 30-year loan at 6%, roughly the first third of payments go mostly to interest, and the crossover where principal exceeds interest arrives around year 18.
How much does one extra payment a year save?: A single extra monthly payment per year typically cuts a 30-year term by 4-6 years and saves tens of thousands in interest, because every extra pound goes entirely to principal and removes all future interest that balance would have accrued.
What does the payment figure leave out?: Principal and interest only. Your real outgoing usually adds property tax, buildings insurance, and — where the deposit is under 20% — mortgage insurance (PMI in the US). Together these commonly add 20-30% on top of the P&I figure.
Is a 15-year mortgage better than a 30?: It carries a lower rate and dramatically less total interest, but a much higher monthly commitment that cannot be reduced later. A 30-year with voluntary overpayments gives most of the saving while keeping the option to pay less in a bad month.
How does an offset or redraw facility change the arithmetic?: Interest is charged on the balance minus the offset, so money parked there earns the loan's rate tax-free rather than a deposit rate taxed as income. That is why an offset usually beats a savings account at the same headline rate.
What does the loan-to-value ratio affect?: The rate you are offered and whether lender's mortgage insurance applies — commonly required above 80% LTV, and paid by you to protect the lender. Crossing that threshold can change the total cost more than a small rate difference.

Common errors and gotchas

Quoting principal and interest only, when tax, insurance and any mortgage insurance are also monthly.
Using the headline rate rather than the one you would be offered.
Assuming the rate is fixed for the whole term when the product is variable or fixed for a short period.
Ignoring fees and points, which change the effective rate materially.
Treating the estimate as an approval, which only underwriting provides.