Mortgage Calculator
Use this free Mortgage Calculator to calculate your Monthly payment estimate instantly and accurately.
Loan details
Your estimate
What is a Mortgage Calculator?
A Mortgage Calculator is a free online tool that estimates your monthly mortgage payment based on the home price, down payment, interest rate, loan term, property tax, insurance, and HOA fees. It helps you understand what you can afford before you start house hunting.
How to calculate mortgage manually (the formula)
The standard amortization formula for the monthly payment is: M = P [ r(1+r)n ] / [ (1+r)n – 1 ] where M is the monthly payment, P is the loan amount (home price minus down payment), r is the monthly interest rate (annual rate ÷ 12), and n is the number of monthly payments (term in years × 12).
Example calculation
For a $350,000 home with a $70,000 down payment (20%), a 6.5% annual rate, and a 30-year term: the loan amount is $280,000. The monthly rate is 0.5417% (6.5% ÷ 12). Over 360 payments, the principal and interest portion comes to about $1,770. Adding $292 for taxes and $100 for insurance gives a total estimated monthly payment of roughly $2,162.
Common mistakes
- Ignoring property taxes and insurance — These can add hundreds to your monthly payment and significantly affect affordability.
- Using the wrong interest rate — Your actual rate depends on your credit score, down payment, and lender. Always check current rates.
- Forgetting HOA fees — Many properties have mandatory HOA fees that add to your monthly housing cost.
- Not considering closing costs — Closing costs (typically 2–5% of the home price) are paid upfront and not included in the monthly payment.
- Overestimating affordability — A mortgage pre-approval gives you a realistic budget based on your income, debts, and credit.
Frequently asked questions
How does a mortgage calculator work?
A mortgage calculator estimates your monthly payment by taking your home price, down payment, interest rate, and loan term. It uses the standard amortization formula to divide the total loan plus interest into equal monthly payments over the term.
What factors affect my monthly mortgage payment?
Your monthly payment depends on the loan amount, interest rate, loan term, property taxes, homeowner's insurance, and HOA fees. A larger down payment or lower rate reduces your monthly payment.
What is the difference between principal and interest?
Principal is the amount you borrowed. Interest is the cost of borrowing that money. Each monthly payment goes partly toward paying down the principal and partly toward paying the interest.
How does my down payment affect my mortgage?
A larger down payment means you borrow less, which lowers your monthly payment. It also reduces the loan-to-value ratio, which can qualify you for a better interest rate and may eliminate the need for PMI.
Should I choose a 15-year or 30-year mortgage?
A 15-year mortgage has higher monthly payments but much less total interest. A 30-year mortgage has lower monthly payments but costs more in interest over the life of the loan. Choose based on your budget and long-term goals.
Is this calculator free to use?
Yes, completely free with no sign-up or download required. You can use it as many times as you like.