Mortgage Calculator
Home loan payment breakdown
Optional: Additional Costs
Affordability Check (28% Rule)
How to Use the Mortgage Calculator
Get a complete breakdown of your potential mortgage payment including principal, interest, property taxes, insurance, and PMI. See how down payment affects your monthly costs.
Payment Components
- Principal & Interest: Your base loan payment
- Property Tax: Annual tax divided by 12
- Insurance: Homeowner's insurance premium
- PMI: Required when down payment is less than 20%
PMI Considerations
Private Mortgage Insurance is typically required for loans with less than 20% down payment. PMI usually ranges from 0.3% to 1.5% of the loan amount annually. It can be removed once you reach 20% equity.
Planning Your Home Purchase
Use our amortization calculator to see the full payment schedule and how extra payments save money. Calculate your take-home pay to ensure the mortgage fits your budget. For a complete guide on home financing, read Understanding Mortgage Rates and Payments.
Beyond the Calculator
This calculator provides estimates. Your actual rate depends on credit score, debt-to-income ratio, and loan type. Consider getting pre-approved to understand your true buying power. Compare options with our loan calculator.
Frequently Asked Questions
A common guideline is 3-4x your annual income. With household income of $80,000, you could afford a home around $240,000-$320,000. However, actual affordability depends on down payment, debts, credit score, interest rates, and local property taxes.
A typical mortgage payment includes PITI: Principal (loan balance), Interest (cost of borrowing), Taxes (property taxes), and Insurance (homeowners and possibly PMI). Your escrow account holds funds for taxes and insurance.
20% down is traditional and avoids PMI, but many programs accept 3-5% down. FHA loans require 3.5% minimum. VA and USDA loans offer 0% down for eligible borrowers. Larger down payments mean lower monthly payments and interest costs.
PMI (Private Mortgage Insurance) protects lenders when down payment is under 20%, typically costing 0.5-1% of loan value annually. Avoid it by putting 20% down, using a piggyback loan, or choosing lender-paid PMI. PMI is removable at 20% equity.
One point equals 1% of your loan amount and typically reduces your rate by 0.25%. On a $300,000 loan, 1 point costs $3,000 and might reduce rate from 7% to 6.75%, saving $50/month. Points make sense if you keep the loan long enough to break even.
15-year mortgages have higher payments but much lower total interest. A $300,000 loan at 6.5% costs $320,194 in interest over 30 years vs. $112,432 over 15 years - a savings of over $200,000. Choose based on your budget and goals.
Closing costs typically run 2-5% of the loan amount, including origination fees, appraisal, title insurance, and prepaid taxes/insurance. On a $300,000 loan, expect $6,000-$15,000 in closing costs. Negotiate with sellers or lenders to reduce these.