Mortgage Calculator

1. Enter the what do you want to work out?, gross monthly household income, how aggressive should this be?, purchase price and down payment and the remaining inputs.
2. Optionally add other monthly debt payments, cash for the down payment, property tax rate and property tax — leave blank to skip.
3. Read the highlighted result first, then the breakdown below it. Load the worked example to check the math by hand.

The principal and interest portion uses the standard amortization formula. Escrow items are not part of the loan — they are added on top of it, which is why a quoted rate never tells you the whole monthly cost.

• Loan amount = purchase price − down payment
• Monthly rate r = annual rate ÷ 100 ÷ 12, number of payments n = years × 12
• Principal & interest = loan × r ÷ (1 − (1 + r)^−n); at 0% it is loan ÷ n
• Monthly PMI = loan × (PMI rate ÷ 100) ÷ 12, charged only while loan ÷ price is above 80%
• Total monthly payment = principal & interest + tax ÷ 12 + insurance ÷ 12 + HOA + PMI
• Total interest = principal & interest × n − loan

The total monthly payment is principal and interest plus one-twelfth of your annual tax and insurance, HOA, and PMI while it applies. Principal and interest is the only part fixed by the loan; the escrow items change as tax and insurance bills change.

Common mistakes and assumptions

• Comparing a quoted rate against this total — a lender's P&I figure excludes tax, insurance, HOA, and PMI.
• Leaving PMI on: this calculator charges it only while the loan is above 80% of the purchase price, and it does not model when your equity later crosses that line.
• Reading total interest as certain. It assumes you keep the loan for the full term and never pay extra or refinance.

A $420,000 house with $84,000 down (20%) on a 30-year loan at 6.5%, with $4,800 annual tax, $1,800 insurance, and no HOA.

1. 1Loan = $420,000 − $84,000 = $336,000.
2. 2Monthly rate = 6.5 ÷ 100 ÷ 12 = 0.00541667, and n = 360 payments.
3. 3Principal & interest = $336,000 × 0.00541667 ÷ (1 − 1.00541667^−360) = $2,123.75.
4. 4Escrow = $4,800 ÷ 12 + $1,800 ÷ 12 = $400 + $150 = $550.
5. 5Loan-to-value is exactly 80%, so the 0.5% PMI figure is not charged.
6. 6Total monthly payment = $2,123.75 + $550 = $2,673.75, and total interest over 30 years is $428,549.

How do I use this to work out how much house I can afford?

Switch the mode at the top of the form to "How much house can I afford?". Enter your gross monthly household income, other monthly debt payments, the cash you have for a down payment and your rate and term. The calculator then solves backwards for the highest home price whose full housing payment — principal, interest, property tax, insurance, HOA and PMI — stays inside the housing and total-debt share you picked. It reports a recommended price, a stretch limit, which constraint is binding and what would move the number most. These are transparent guideline ratios, not a lender's approval.

Does this include closing costs?

No. It covers the recurring monthly payment only. Closing costs, points, and prepaid escrow deposits are one-time amounts due at signing and vary by lender and state.

When does PMI stop?

Most conventional lenders drop private mortgage insurance once the loan falls to 80% of value, and are required to cancel it at 78% on the original schedule. This calculator only charges PMI when your starting loan is above 80% of the price, and holds the amount flat.

Why is my lender's number slightly different?

Lenders round payments, may collect escrow cushions, and sometimes quote with points folded in. A few dollars of difference is normal; a large gap usually means a different rate, term, or escrow assumption.

Should I enter tax and insurance monthly or annually?

Annually. Both fields ask for the yearly amount and are divided by 12. HOA dues are the exception and are entered per month, because that is how they are billed.

Worked answers with real figures and stated assumptions, written around the question people usually arrive with.

• 15-year vs 30-year mortgage: the real cost comparisonPayment, total interest and equity compared, plus the flexible middle option most buyers overlook.
• How much house can I afford on my salary?Convert income, debts and a down payment into a home-price range, with the tax and insurance drag included.
• Rent vs buy: how long do you need to stay for buying to win?Find the year buying overtakes renting under your own assumptions — and which assumption is deciding it.

A price range is the start of the decision, not the end. These tools cover what usually comes next.

1. Step 1Rent vs Buy CalculatorTest whether buying beats renting over the years you actually plan to stay.
2. Step 2Take-Home Pay CalculatorBase the housing budget on estimated net pay rather than gross salary.
3. Step 3Debt Payoff by Extra Payment CalculatorSee what monthly debt you could clear first to widen the affordable range.
4. Step 4Rental Property Cash Flow CalculatorBuying to let rather than to live in? Check whether the numbers carry themselves.
5. Step 5Loan Payment CalculatorCompare a different term or a non-mortgage loan on the same amortization math.