A mortgage is a significant financial commitment, and understanding how your monthly payment is calculated is crucial. The principal and interest (P&I) portion of your mortgage payment is determined by a formula that considers three main factors: the loan amount, the annual interest rate, and the loan term. This calculator helps you estimate this core part of your monthly housing expense.
The Mortgage Payment Formula (P&I)
The standard formula for calculating the monthly payment (M) of a fixed-rate mortgage 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 your annual interest rate by 12. For example, if your annual rate is 6%, your monthly rate is 0.06 / 12 = 0.005.
n = The total number of payments over the loan's lifetime. This is calculated by multiplying the number of years in your loan term by 12. For a 30-year mortgage, n = 30 * 12 = 360.
How to Use This Calculator
Loan Amount: Enter the total amount of money you are borrowing for your home.
Annual Interest Rate: Input the interest rate offered by your lender, expressed as a percentage (e.g., 4.5 for 4.5%).
Loan Term (Years): Specify the duration of your mortgage in years (e.g., 15, 30).
Clicking "Calculate Monthly Payment" will apply the formula above to provide an estimate of your principal and interest payment.
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 typically includes:
Property Taxes: Annual taxes assessed by your local government, often paid monthly as part of your mortgage payment (escrow).
Homeowners Insurance: Coverage for damage to your home, also usually paid monthly via escrow.
Private Mortgage Insurance (PMI): If your down payment is less than 20% of the home's price, you'll likely pay PMI, which protects the lender.
Homeowners Association (HOA) Fees: If you live in a community with an HOA, these mandatory fees are an additional cost.
Use this calculator as a starting point to understand the impact of loan amount, interest rate, and term on your P&I payment. Always consult with your lender for a precise mortgage quote.
function calculateMortgage() {
var principal = parseFloat(document.getElementById("loanAmount").value);
var annualRate = parseFloat(document.getElementById("annualInterestRate").value);
var years = parseInt(document.getElementById("loanTerm").value);
var errorMessageElement = document.getElementById("errorMessage");
var resultValueElement = document.getElementById("result-value");
errorMessageElement.textContent = ""; // Clear previous errors
resultValueElement.textContent = "$0.00"; // Reset result
// Input validation
if (isNaN(principal) || principal <= 0) {
errorMessageElement.textContent = "Please enter a valid loan amount.";
return;
}
if (isNaN(annualRate) || annualRate <= 0) {
errorMessageElement.textContent = "Please enter a valid annual interest rate.";
return;
}
if (isNaN(years) || years 0) {
monthlyPayment = principal * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
} else {
// Handle case of 0% interest rate (though rare for mortgages)
monthlyPayment = principal / numberOfPayments;
}
// Display the result, formatted to two decimal places
resultValueElement.textContent = "$" + monthlyPayment.toFixed(2);
}