Your estimated monthly mortgage payment will be: $0.00
Understanding Your Mortgage Payment
A mortgage is a significant financial commitment, and understanding how your monthly payment is calculated is crucial for budgeting and financial planning. The monthly mortgage payment (Principal and Interest or P&I) is determined by three main factors: the loan amount (principal), the annual interest rate, and the loan term (the duration of the loan).
Principal: This is the total amount of money borrowed from the lender to purchase your home. It's the base amount on which interest is calculated. A larger principal will naturally result in a higher monthly payment.
Annual Interest Rate: This is the percentage charged by the lender for borrowing the money. A higher interest rate means more money paid towards interest over the life of the loan, thus increasing your monthly payment. Interest rates can fluctuate based on market conditions and your creditworthiness.
Loan Term: This is the length of time you have to repay the loan, usually expressed in years (e.g., 15, 30 years). A shorter loan term will have higher monthly payments because you're paying off the principal and interest over a shorter period. Conversely, a longer loan term will result in lower monthly payments but more interest paid overall.
The formula used to calculate the monthly mortgage payment (M) is:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
P = Principal loan amount
i = Monthly interest rate (annual interest rate divided by 12)
n = Total number of payments (loan term in years multiplied by 12)
This calculator provides an estimate of your Principal and Interest (P&I) payment. Remember that your actual total monthly housing expense may also include property taxes, homeowner's insurance, and potentially Private Mortgage Insurance (PMI) or Homeowners Association (HOA) fees, which are not included in this calculation.
function calculateMortgage() {
var principal = parseFloat(document.getElementById("principal").value);
var annualInterestRate = parseFloat(document.getElementById("annualInterestRate").value);
var loanTerm = parseFloat(document.getElementById("loanTerm").value);
var resultDisplay = document.getElementById("mortgage-result").querySelector("span");
if (isNaN(principal) || isNaN(annualInterestRate) || isNaN(loanTerm) || principal <= 0 || annualInterestRate < 0 || loanTerm <= 0) {
resultDisplay.textContent = "Please enter valid positive numbers for all fields.";
return;
}
var monthlyInterestRate = (annualInterestRate / 100) / 12;
var numberOfPayments = loanTerm * 12;
var monthlyPayment = principal * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
if (isNaN(monthlyPayment) || !isFinite(monthlyPayment)) {
resultDisplay.textContent = "Calculation error. Please check your inputs.";
} else {
resultDisplay.textContent = "$" + monthlyPayment.toFixed(2);
}
}