A mortgage is a long-term loan used to purchase real estate, where the property itself serves as collateral for the lender. The monthly payment for a mortgage is primarily determined by three key factors: the principal loan amount, the annual interest rate, and the loan term (the duration of the loan). This calculator helps you estimate your principal and interest (P&I) portion of the monthly mortgage payment.
How the Calculation Works
The standard formula used to calculate a fixed-rate mortgage's monthly payment is:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
M = Your total monthly mortgage payment (Principal & Interest)
P = The principal loan amount (the amount you borrow)
i = Your monthly interest rate. This is calculated by dividing the annual interest rate by 12. For example, if your annual rate is 4.5%, your monthly rate (i) is 0.045 / 12 = 0.00375.
n = The total number of payments over the loan's lifetime. This is calculated by multiplying the loan term in years by 12. For example, a 30-year mortgage has 30 * 12 = 360 payments.
Components of a Mortgage Payment
It's important to note that this calculator estimates only the Principal and Interest (P&I) portion of your monthly payment. Your actual total monthly housing expense will likely be higher and may include:
Property Taxes: Paid to your local government.
Homeowners Insurance: Required by lenders to protect against damage.
Private Mortgage Insurance (PMI): Often required if your down payment is less than 20%.
Homeowners Association (HOA) Fees: If applicable.
Why Use a Mortgage Calculator?
This calculator is a valuable tool for:
Budgeting: Understanding how much you can afford for a monthly payment.
Comparing Loan Offers: Evaluating different interest rates and terms.
Financial Planning: Estimating the cost of homeownership.
By inputting different scenarios, you can gain a clearer picture of your potential mortgage obligations.
function calculateMortgage() {
var principal = parseFloat(document.getElementById("loanAmount").value);
var annualRate = parseFloat(document.getElementById("annualInterestRate").value);
var years = parseFloat(document.getElementById("loanTermYears").value);
var resultValueElement = document.getElementById("result-value");
resultValueElement.textContent = "–"; // Reset previous result
// Input validation
if (isNaN(principal) || principal <= 0) {
alert("Please enter a valid principal loan amount.");
return;
}
if (isNaN(annualRate) || annualRate < 0) {
alert("Please enter a valid annual interest rate.");
return;
}
if (isNaN(years) || years <= 0) {
alert("Please enter a valid loan term in years.");
return;
}
// Calculate monthly interest rate and number of payments
var monthlyRate = annualRate / 100 / 12;
var numberOfPayments = years * 12;
var monthlyPayment = 0;
// Handle the case where the interest rate is 0%
if (monthlyRate === 0) {
monthlyPayment = principal / numberOfPayments;
} else {
// Calculate monthly payment using the standard mortgage formula
monthlyPayment = principal * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
}
// Format the result to two decimal places and add currency symbol
resultValueElement.textContent = "$" + monthlyPayment.toFixed(2);
}