Calculate your estimated monthly mortgage payment (principal and interest).
Your Estimated Monthly Payment (P&I):
$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 primary components of a standard mortgage payment are Principal and Interest (P&I).
The Mortgage Payment Formula
The most common formula used to calculate the fixed monthly payment for a mortgage (an amortizing loan) is as follows:
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 total amount you borrowed)
i = Your monthly interest rate. This is your annual interest rate divided by 12. For example, if your annual rate is 4.5%, your monthly rate is 0.045 / 12 = 0.00375.
n = The total number of payments over the loan's lifetime. This is your loan term in years multiplied by 12. For a 30-year mortgage, n = 30 * 12 = 360.
How the Calculator Works
This calculator takes your inputs for the Loan Amount, Annual Interest Rate, and Loan Term (in years) and applies the formula above. It first converts the annual interest rate to a monthly rate and the loan term in years to the total number of monthly payments. It then plugs these values into the formula to compute your estimated monthly principal and interest payment.
Example Calculation
Let's say you are looking to buy a home and need a mortgage with the following details:
Loan Amount (P): $300,000
Annual Interest Rate: 4.5%
Loan Term: 30 years
First, we calculate the monthly interest rate (i) and the total number of payments (n):
Calculating this yields an estimated monthly Principal & Interest payment of approximately $1,520.06.
Important Considerations
This calculator provides an estimate for the Principal and Interest (P&I) portion of your mortgage payment only. Your actual total monthly housing expense will likely be higher and may include:
Property Taxes: Paid to your local government.
Homeowner's Insurance: Required by lenders to protect against damage.
Private Mortgage Insurance (PMI): Typically required if your down payment is less than 20%.
Homeowners Association (HOA) Fees: If applicable.
Always consult with a mortgage professional for a precise quote tailored to your financial situation and the specific loan products available.
function calculateMortgage() {
var loanAmountInput = document.getElementById("loanAmount");
var annualInterestRateInput = document.getElementById("annualInterestRate");
var loanTermYearsInput = document.getElementById("loanTermYears");
var monthlyPaymentDisplay = document.getElementById("monthlyPayment");
var loanAmount = parseFloat(loanAmountInput.value);
var annualInterestRate = parseFloat(annualInterestRateInput.value);
var loanTermYears = parseFloat(loanTermYearsInput.value);
// Input validation
if (isNaN(loanAmount) || loanAmount <= 0 ||
isNaN(annualInterestRate) || annualInterestRate < 0 ||
isNaN(loanTermYears) || loanTermYears 0) {
// Standard Amortization Formula
monthlyPayment = loanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
// If interest rate is 0, payment is just principal divided by number of payments
monthlyPayment = loanAmount / numberOfPayments;
}
// Format the result to two decimal places and add currency symbol
monthlyPaymentDisplay.textContent = "$" + monthlyPayment.toFixed(2);
}