Monthly Mortgage Payment Calculator
30 Years
20 Years
15 Years
10 Years
Total Monthly Payment
Principal & Interest
Property Taxes
Homeowners Insurance
HOA Fees
Loan Amount
Total Interest Paid
Total Cost of Loan
Understanding Your Mortgage Payment Breakdown
Purchasing a home is one of the most significant financial decisions you will make. While the listing price gives you an idea of the home's value, your true monthly cost involves much more than just paying back the loan. Our Mortgage Payment Calculator helps you estimate your actual monthly housing expenses by factoring in principal, interest, taxes, insurance, and HOA fees.
The Components of a Monthly Mortgage Payment
Most homeowners pay a single lump sum to their lender each month, but that payment is distributed into several different "buckets." This structure is often referred to as PITI (Principal, Interest, Taxes, and Insurance).
| Component | Description |
|---|---|
| Principal | The portion of your payment that reduces the loan balance. In the early years of a loan, this amount is small, but it grows over time. |
| Interest | The cost of borrowing money from the lender. On a standard amortization schedule, interest makes up the majority of your payment in the beginning. |
| Escrow (Taxes & Insurance) | Lenders often collect 1/12th of your annual property taxes and homeowners insurance each month and hold it in an escrow account to pay the bills when they are due. |
| HOA Fees | If you buy a condo or a home in a planned community, you may owe Homeowners Association fees. While usually paid directly to the HOA, lenders factor this into your debt-to-income ratio. |
How Interest Rates Affect Affordability
Even a small change in interest rates can drastically alter your monthly payment and the total cost of the loan. For example, on a $300,000 loan, the difference between a 6% and a 7% interest rate can add hundreds of dollars to your monthly obligation and tens of thousands in total interest over 30 years.
Principal vs. Interest Over Time
Mortgages typically use an amortization schedule. This means that while your total monthly Principal & Interest payment remains constant (for fixed-rate mortgages), the ratio changes.
- Years 1-10: Your payments are primarily interest. You build equity slowly.
- Years 11-20: The split becomes more even.
- Years 21-30: Your payments are primarily principal, paying down the debt rapidly.
Tips for Lowering Your Monthly Payment
If the calculated payment is higher than your budget allows, consider these strategies:
- Increase your down payment: This lowers the principal loan amount and may remove the need for Private Mortgage Insurance (PMI).
- Shop for lower insurance rates: Homeowners insurance premiums vary significantly by provider.
- Buy "points": You can pay an upfront fee to the lender to lower your interest rate for the life of the loan.
- Look for lower property taxes: Taxes vary by county and municipality. Choosing a home in a different zone can save thousands annually.