Mortgage Payment Calculator
The payment you will actually write a cheque for: principal and interest, plus the tax, insurance, mortgage insurance and HOA dues that ride along with them.
Monthly mortgage payment calculator
Where the monthly payment goes
| Component | Per month | Per year | Share of payment |
|---|
The same loan at different rates
| Rate | Principal & interest | Difference vs. your rate | Total interest |
|---|
Same loan amount, same term, same taxes and insurance. Only the rate changes.
What a monthly payment is actually made of
A mortgage payment is not one number, it is five, and only two of them appear in most calculators. Principal and interest are the loan itself. Property tax and homeowners insurance are collected by the lender in escrow and paid on your behalf. Mortgage insurance appears when you put down less than 20 percent. HOA dues go to the association, not the lender, but they count against you in underwriting and they never stop.
The gap is large enough to change what you can afford. On a $400,000 house with 20 percent down at 6.5 percent, principal and interest come to $2,023 a month. Add a 1.1 percent tax rate and $1,800 of insurance and the real figure is $2,540 — twenty-six percent higher than the number on the rate sheet. At 5 percent down the same house costs $3,141 a month, because the loan is bigger and mortgage insurance joins the list.
How the payment is calculated
Principal and interest come from the standard amortization formula, which solves for the constant payment that retires the loan exactly at the end of the term. Escrow items are simpler: they are annual amounts divided by twelve.
Worked through with the default numbers: a $400,000 price with 20 percent down leaves a $320,000 loan. At 6.5 percent the monthly rate r is 0.0054167 and n is 360. The divisor is 1 − 1.0054167−360 = 0.857014, so the payment is $320,000 × 0.0054167 ÷ 0.857014 = $2,022.62, which rounds to $2,023. Property tax at 1.1 percent of the purchase price is $4,400 a year, or $366.67 a month. Insurance is $1,800 a year, or $150. The three together are $2,540.
The split inside that first payment is worth seeing. Interest in month one is $320,000 × 0.0054167 = $1,733.33, so only $289 goes to principal. Eighty-six percent of the first cheque is rent on the money. By year fifteen the ratio has inverted, and in the final year almost the entire payment is principal. That is why extra payments made early are worth so much more than the same dollars paid late — a point the early payoff calculator works out month by month.
The part of the payment that is not fixed
The principal and interest line is fixed for thirty years. Everything else moves, which is why a payment that was comfortable in year one can feel tight in year six.
Escrow shortages
Lenders collect one-twelfth of the annual tax and insurance bill and hold it. If the actual bill comes in higher than projected, the account runs short, and the servicer recovers the difference by raising your monthly payment — sometimes by a lot, because they also build a cushion to prevent the next shortage. A payment that jumps $80 after a reassessment year is normal.
Insurance repricing
Homeowners insurance is the least predictable line in the escrow account. Premiums in many markets have risen sharply, and a policy that cost $1,800 when you closed can renew at $2,600. That is $67 a month, with no change to your loan.
Reassessment after purchase
The tax bill you inherit belongs to the seller and reflects an assessment that may be years old. Many jurisdictions reassess on sale, so the first full year at your ownership can carry a higher bill than the one disclosed at closing. Ask the assessor's office what the tax will be at your purchase price, not what the seller paid.
Mortgage insurance falling off
If you put down less than 20 percent, PMI is required until the loan balance reaches 78 percent of the original value, at which point federal rules require the servicer to terminate it automatically. You can usually request removal at 80 percent. On a $360,000 loan at 6.5 percent, that day arrives somewhere around year nine, and the payment drops by the PMI amount — $165 a month in the table below.
Fifteen years or thirty
On the same $320,000 at 6.5 percent, a 15-year loan costs $2,788 a month against $2,023, and saves about $226,000 in interest. The extra $765 buys a lower rate in most markets as well, since 15-year loans are priced a quarter to a half point below 30-year paper, which widens the gap slightly in the 15-year's favour.
The case against is liquidity and obligation. The 15-year commits you to that higher payment in every month, including the ones where the roof, the transmission and the furnace fail together. The 30-year plus a voluntary extra payment produces a similar payoff if you actually make the extra payment, and nothing if you do not. Most people who intend to invest the difference do not, which is the honest argument for the shorter term: it removes the choice.
The income behind the payment
Lenders test two ratios. The front-end ratio is housing cost divided by gross monthly income, and 28 percent is the traditional ceiling. The back-end ratio adds car loans, student debt, minimum card payments and child support, with 36 percent as the conventional target and roughly 43 percent as the practical maximum for a qualified mortgage.
A $2,540 payment clears the 28 percent front-end test at $9,071 a month, or about $108,900 a year. That figure assumes no other debt. Carrying a $450 car payment and $200 in student loans pushes the income requirement to roughly $124,000, because those amounts eat into the back-end allowance even though they never appear on the mortgage statement.
Down payments change more than the loan
This table uses the same $400,000 price and 6.5 percent rate, and shows why 20 percent is a real threshold rather than a tradition. PMI rates vary by lender and credit score; 0.55 percent a year at 10 percent down and 0.70 percent at 5 percent are typical mid-score figures.
| Down payment | Loan amount | Principal & interest | PMI | Total monthly |
|---|---|---|---|---|
| 5% ($20,000) | $380,000 | $2,402 | $222 | $3,141 |
| 10% ($40,000) | $360,000 | $2,275 | $165 | $2,957 |
| 20% ($80,000) | $320,000 | $2,023 | $0 | $2,540 |
The last step is the biggest. Going from 10 to 20 percent costs $40,000 more down but cuts the payment by $417 a month, and $165 of that is PMI disappearing rather than the smaller loan. The property tax calculator covers the escrow side separately if you want to check the tax figure against your own county.
What this calculator leaves out
The monthly payment is not the cost of buying. Closing costs run 2 to 5 percent of the price and are paid once, at the table. Prepaid items — the first year of insurance, several months of tax, per-diem interest — are collected at closing and then sit in the escrow account, so they are a cash-flow cost rather than a fee.
Ongoing ownership adds maintenance, which a common rule of thumb puts at 1 percent of value a year, or $333 a month on this house, plus utilities. Neither appears in a mortgage payment, and both are real. The insurance estimator covers the rebuild-cost side, which is the input most people guess wrong.
Finally, the interest you pay may be partly deductible. The mortgage interest deduction calculator works out how much survives the standard deduction and the $750,000 debt cap, which in turn determines whether the effective cost of this loan is lower than its rate.
Frequently asked questions
Does this include taxes and insurance?
Yes — the total monthly figure includes property tax, homeowners insurance, mortgage insurance where it applies, and HOA dues. That is the amount that leaves your account, and it is the number to compare against your budget. The principal-and-interest line is shown separately because it is the only part that stays fixed.
Why is my real payment higher than the number here?
Three usual reasons. Your actual tax rate may be higher than the default 1.1 percent, which ranges from well under 0.5 percent in parts of the South to over 2 percent in parts of the Northeast and Texas. Your insurance may cost more than $1,800 a year, especially in hail or wildfire territory. Or the lender is collecting a cushion and prepaids on top of the escrow payment. Check your Loan Estimate's "Estimated Escrow" line against this calculator.
What is PMI and when does it go away?
Private mortgage insurance protects the lender, not you, and is required when the down payment is under 20 percent. It is priced as a percentage of the loan — commonly 0.3 to 1.5 percent a year depending on credit and down payment. It ends automatically when the balance reaches 78 percent of the original value, and you can ask for removal at 80 percent. A new appraisal can sometimes get it removed sooner if values have risen.
Which rate should I enter?
The note rate on page one of your Loan Estimate, not the APR. The APR bundles fees and mortgage insurance into a single comparison number, which is useful for shopping but wrong for computing a payment. If you are still shopping, use a rate you have actually been quoted in writing rather than an advertised teaser.
Should I take the 15-year or the 30-year?
Take the 30-year if the higher payment would leave you without an emergency fund, or if you have other debt at a higher rate. Take the 15-year if you can carry the payment through a bad year and would rather be forced to save. The arithmetic favours the shorter loan; the risk management favours the longer one, and which matters more depends on your income stability.
How much income do I need for this payment?
At least $9,071 a month of gross income if housing is the only debt, using the 28 percent front-end rule. Add other debt payments and the requirement rises: lenders also cap total debt at roughly 36 to 43 percent of gross income. Both tests use gross pay, before tax and retirement contributions, which is why the payment can look affordable on paper and still feel heavy.
Why did my payment go up when my rate is fixed?
Because only principal and interest are fixed. The escrow portion is an estimate that gets trued up every year against the actual tax bill and insurance premium. When those rise, the servicer raises the monthly collection and may also add a shortage recovery amount. A fixed-rate mortgage with a rising escrow payment is normal, not an error.
Is a bigger down payment always better?
It lowers the payment and the total interest, and at 20 percent it removes mortgage insurance entirely. But it also converts liquid cash into home equity that is expensive to access. Keeping three to six months of expenses in reserve usually matters more than shaving another $50 off the payment, and at rates below roughly 4 percent the money may earn more elsewhere.
Disclaimer: This calculator produces planning estimates, not a loan offer. Actual payments depend on the lender's escrow analysis, your county's assessment, your insurance policy, and any PMI pricing specific to your credit profile. Confirm every figure on a Loan Estimate before you commit.
Citing this page? FigureMill, “Mortgage Payment Calculator” (last reviewed October 31, 2026). The full monthly payment — principal, interest, escrow items, mortgage insurance and HOA — computed from price, down payment, rate and term, with the year-one interest split. https://figuremill.com/home-tax/mortgage-payment-calculator
Related: Mortgage interest deduction · Early payoff calculator · Property tax calculator · Home insurance estimator · All home tax tools