(Private Mortgage Insurance – typically applies if down payment < 20%)
$0.00Monthly Payment
Understanding Your Mortgage Payment
A mortgage is one of the largest financial commitments most people make. Understanding all the components of your monthly mortgage payment is crucial for budgeting and financial planning. This calculator helps you estimate your total monthly payment, including the principal and interest on your loan, plus essential extras like property taxes, homeowner's insurance, and Private Mortgage Insurance (PMI).
The Components of Your Monthly Payment (PITI + PMI):
Principal: The amount of money borrowed to buy the home. This portion of your payment gradually reduces your outstanding loan balance.
Interest: The cost of borrowing the money. For most of the loan term, a larger portion of your payment goes towards interest than principal.
Taxes: Your estimated annual property taxes, divided by 12 and added to your monthly payment. These funds are typically held in an escrow account by your lender and paid to local tax authorities on your behalf.
Insurance: Your estimated annual homeowner's insurance premium, divided by 12. This also is usually paid from an escrow account to protect against damage to your property.
PMI (Private Mortgage Insurance): If your down payment is less than 20% of the home's purchase price, lenders typically require PMI. This insurance protects the lender in case you default on the loan. The annual PMI rate is divided by 12 and added to your monthly payment. Once you reach 20% equity, you can usually request to have PMI removed.
How the Calculator Works:
The calculator first determines the Principal and Interest (P&I) portion of your mortgage payment using the standard mortgage payment formula:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
M = Your total monthly mortgage payment (P&I portion)
P = The principal loan amount
i = Your monthly interest rate (annual rate divided by 12)
n = The total number of payments over the loan's lifetime (loan term in years multiplied by 12)
Once the P&I is calculated, the calculator adds the monthly breakdown of your estimated annual property taxes, annual homeowner's insurance, and annual PMI (if applicable). The sum of these amounts provides your estimated total monthly mortgage payment (often referred to as PITI + PMI).
Example Scenario:
Let's say you are purchasing a home for $350,000 with a down payment leaving a loan amount (Principal) of $300,000. You secure a 30-year mortgage with an annual interest rate of 4.5%. Your estimated annual property taxes are $4,800, and your annual homeowner's insurance is $1,200. Since your down payment was less than 20%, you also have an annual PMI rate of 0.5% on the loan amount.
Using the calculator:
Principal: $300,000
Interest Rate: 4.5%
Loan Term: 30 years
Annual Taxes: $4,800 ($400/month)
Annual Insurance: $1,200 ($100/month)
PMI Rate: 0.5% ($1,500/year or $125/month on $300,000)
The calculator will compute the P&I, add the monthly tax, insurance, and PMI amounts to give you a comprehensive monthly payment estimate.
function calculateMortgage() {
var principal = parseFloat(document.getElementById("principal").value);
var annualInterestRate = parseFloat(document.getElementById("interestRate").value);
var loanTermYears = parseFloat(document.getElementById("loanTerm").value);
var annualTaxes = parseFloat(document.getElementById("annualTaxes").value);
var annualInsurance = parseFloat(document.getElementById("annualInsurance").value);
var pmiRate = parseFloat(document.getElementById("pmiRate").value);
var resultElement = document.getElementById("result");
// Validate inputs
if (isNaN(principal) || principal <= 0 ||
isNaN(annualInterestRate) || annualInterestRate < 0 ||
isNaN(loanTermYears) || loanTermYears <= 0 ||
isNaN(annualTaxes) || annualTaxes < 0 ||
isNaN(annualInsurance) || annualInsurance < 0 ||
isNaN(pmiRate) || pmiRate < 0) {
resultElement.innerHTML = "$0.00Invalid input. Please enter valid numbers.";
return;
}
// Calculate monthly interest rate
var monthlyInterestRate = annualInterestRate / 100 / 12;
// Calculate number of payments
var numberOfPayments = loanTermYears * 12;
var pniPayment = 0;
// Calculate Principal and Interest (P&I)
if (monthlyInterestRate > 0) {
pniPayment = principal * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
// Handle 0% interest rate case
pniPayment = principal / numberOfPayments;
}
// Calculate monthly taxes, insurance, and PMI
var monthlyTaxes = annualTaxes / 12;
var monthlyInsurance = annualInsurance / 12;
var monthlyPmi = (principal * (pmiRate / 100)) / 12; // PMI is often based on the original loan amount
// Calculate total monthly payment
var totalMonthlyPayment = pniPayment + monthlyTaxes + monthlyInsurance + monthlyPmi;
// Format and display the result
resultElement.innerHTML = "$" + totalMonthlyPayment.toFixed(2) + "Estimated Monthly Payment";
}