About the mortgage calculator
This mortgage calculator turns a home price, deposit, interest rate and term into the number most buyers want first: what the monthly payment will be. It also shows how much of the money you repay is interest, when the loan is paid off, and how the balance falls year by year.
You can add yearly property tax and insurance, other monthly costs such as a service charge, and an optional extra monthly payment to see how much interest and time that saves. The result is a planning figure, not a lender's quote.
Who should use the mortgage calculator
- First-time buyers comparing what different prices and deposits do to a monthly budget.
- Existing owners weighing up whether overpaying each month is worth it.
- Anyone in the US, UK, France or Spain who wants to sanity-check a repayment mortgage before talking to a lender or broker.
How to use the mortgage calculator: what each input means
- Home price
- The purchase price of the property.
- Down payment
- Your deposit, entered either as a percentage of the price or as an amount.
- Loan term
- How many years you will take to repay the loan. Terms of 15 to 30 years are typical, but your lender sets the options.
- Interest rate
- The yearly rate on the loan. For a fixed-rate loan, use the rate on your offer; lenders may also quote APR (US/UK), TAEG (France) or TAE (Spain), which include extra charges and are not the same as the plain interest rate.
- Tax, insurance and other costs
- Optional yearly or monthly extras that are added to the monthly total but are not part of the loan itself.
- Extra monthly payment
- Optional money paid on top of the scheduled payment each month.
How the mortgage calculator works: method and formula
The loan amount is the price minus your down payment. The calculator assumes a fixed-rate repayment loan where interest is charged monthly on the remaining balance, and the payment stays level for the whole term.
Each month, interest equals the outstanding balance times the monthly rate (the yearly rate divided by 12). Whatever is left of the payment reduces the balance. Early payments are mostly interest; later ones are mostly principal, which is why paying extra early has a large effect.
- Monthly payment
- M = P × r ÷ (1 − (1 + r)^−n)
- Where
- P = loan amount, r = yearly rate ÷ 12 (as a decimal), n = number of monthly payments
How to read your mortgage calculator result
The headline figure is the monthly payment including any tax, insurance and other costs you entered. The principal-and-interest part is shown separately, because that is the part that repays the loan. Total interest tells you what borrowing costs over the full term, and the yearly table shows how quickly the balance falls.
Compare scenarios by changing one input at a time: a 5-point larger deposit, a shorter term, or a rate that is half a point lower can each change the monthly figure and the total interest in different ways.
Mortgage Calculator worked example
A $400,000.00 home with a 20% deposit, a 30-year term, a 6.5% fixed rate, $4,800.00 of yearly property tax and $1,200.00 of yearly insurance.
- Deposit: 20% of $400,000.00 = $80,000.00, so the loan is $320,000.00.
- Monthly rate r = 6.5% ÷ 12 = 0.541667%, over n = 360 payments.
- Principal and interest: $2,022.62 per month.
- Tax and insurance: ($4,800.00 + $1,200.00) ÷ 12 = $500.00 per month.
Monthly total $2,522.62. Total interest over the term: $408,142.36. Adding $200.00 a month extra shortens the loan by 79 months and saves $105,428.67 in interest.
Practical uses of the mortgage calculator
- Setting a realistic price range before viewing homes.
- Comparing a 15-year and a 30-year term, or two different rates.
- Seeing what an overpayment of a fixed amount each month does to the payoff date.
- Checking a broker's illustration against an independent calculation.
Assumptions and limitations of this calculator
- Models a fixed-rate repayment loan with monthly interest. Variable and tracker rates, interest-only loans, offset accounts and rate changes after an initial period are not modelled.
- Lenders may calculate interest daily or yearly, round payments to the cent and add fees, so the real schedule can differ slightly.
- Property tax, insurance and other costs are simple monthly averages. Taxes such as stamp duty, transfer taxes, notary fees or mortgage insurance are not included.
- Not financial advice. Ask a regulated lender or adviser before you borrow.
Notes for different countries and units
- United States: lenders usually quote a payment that bundles principal, interest, property tax and insurance (often called PITI). Private mortgage insurance usually applies on conventional loans when the deposit is under 20% of the price. Enter it under other monthly costs.
- United Kingdom: many mortgages are fixed for a few years and then move to a different rate. This calculator models one fixed rate for the whole term. To see the effect of a new deal, run it again with the new rate and the remaining term. Stamp Duty Land Tax (England and Northern Ireland), Land and Buildings Transaction Tax (Scotland) and Land Transaction Tax (Wales) are separate costs and are not included.
- India: banks describe the level monthly payment as an EMI (equated monthly instalment). It is the same figure this calculator labels principal and interest. Processing fees and insurance are usually separate.
- Pakistan: many banks offer Islamic home finance, such as diminishing musharakah, where payments are set using a profit rate and a rental structure rather than interest. This calculator uses a conventional reducing-balance schedule, so treat the result as an approximation and rely on your bank's own schedule.
- Type amounts without separators (2500000) or with international grouping (2,500,000). Lakh-style grouping such as 25,00,000 is not accepted by the inputs.