Calculating your monthly mortgage payment is one of the most critical steps in the home buying process. This advanced mortgage calculator helps you estimate your monthly housing costs by factoring in not just the principal and interest, but also property taxes, homeowner's insurance, and Private Mortgage Insurance (PMI).
How is the Monthly Payment Calculated?
The core of a mortgage payment is the Principal and Interest (P&I). This is calculated using the standard amortization formula:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
Where:
• M = Total monthly payment
• P = Principal loan amount (Home Price – Down Payment)
• r = Monthly interest rate (Annual Rate / 12)
• n = Total number of payments (Loan Years × 12)
Key Components Explained
Principal & Interest
The principal is the money you borrowed to buy the house. The interest is the cost of borrowing that money. In the early years of a fixed-rate mortgage, a large portion of your payment goes toward interest. As time passes, more of your payment goes toward reducing the principal balance.
Property Taxes & Insurance (Escrow)
Most lenders require an escrow account where they collect 1/12th of your estimated annual property taxes and homeowner's insurance premiums each month. This calculator adds these monthly portions to your P&I to give you a realistic "out-of-pocket" monthly cost.
Private Mortgage Insurance (PMI)
If your down payment is less than 20% of the home price, lenders typically require PMI. This insurance protects the lender if you default. This calculator automatically applies a PMI estimate if your down payment is under the 20% threshold based on the rate you provide (typically between 0.5% and 1% of the loan amount annually).
Tips for Lowering Your Mortgage Payment
Increase Your Down Payment: Putting 20% down avoids PMI and reduces the principal amount, lowering monthly costs significantly.
Improve Your Credit Score: A higher credit score often qualifies you for lower interest rates, which can save thousands over the life of the loan.
Shop for Insurance: Homeowner's insurance rates vary. Shopping around can lower your monthly escrow requirement.
Consider Loan Term: A 30-year term has lower monthly payments than a 15-year term, though you will pay more in total interest over the life of the loan.
function calculateMortgage() {
// 1. Get Input Values
var homePrice = parseFloat(document.getElementById('homePrice').value);
var downPayment = parseFloat(document.getElementById('downPayment').value);
var interestRate = parseFloat(document.getElementById('interestRate').value);
var loanTermYears = parseFloat(document.getElementById('loanTerm').value);
var annualTax = parseFloat(document.getElementById('propertyTax').value);
var annualInsurance = parseFloat(document.getElementById('homeInsurance').value);
var pmiRate = parseFloat(document.getElementById('pmiRate').value);
// 2. Validation
var errorDiv = document.getElementById('error-message');
var resultsDiv = document.getElementById('results-area');
if (isNaN(homePrice) || isNaN(downPayment) || isNaN(interestRate) || isNaN(loanTermYears) ||
homePrice < 0 || downPayment < 0 || interestRate < 0 || loanTermYears = home price
if (principal <= 0) {
document.getElementById('monthlyPayment').innerText = "$0.00";
document.getElementById('principalInterest').innerText = "$0.00";
document.getElementById('monthlyTax').innerText = formatCurrency(annualTax / 12);
document.getElementById('monthlyInsurance').innerText = formatCurrency(annualInsurance / 12);
document.getElementById('monthlyPMI').innerText = "$0.00";
document.getElementById('totalLoanAmount').innerText = "$0.00";
document.getElementById('totalInterest').innerText = "$0.00";
return;
}
var monthlyRate = (interestRate / 100) / 12;
var numberOfPayments = loanTermYears * 12;
// Amortization Formula: M = P[r(1+r)^n]/[(1+r)^n-1]
var monthlyPrincipalInterest = 0;
if (interestRate === 0) {
monthlyPrincipalInterest = principal / numberOfPayments;
} else {
monthlyPrincipalInterest = principal * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
}
// Monthly Escrow Items
var monthlyTax = annualTax / 12;
var monthlyInsurance = annualInsurance / 12;
// PMI Calculation (Only if Down Payment < 20%)
var downPaymentPercent = (downPayment / homePrice) * 100;
var monthlyPMI = 0;
if (downPaymentPercent < 20) {
monthlyPMI = (principal * (pmiRate / 100)) / 12;
}
var totalMonthlyPayment = monthlyPrincipalInterest + monthlyTax + monthlyInsurance + monthlyPMI;
var totalInterest = (monthlyPrincipalInterest * numberOfPayments) – principal;
// Payoff Date Calculation
var today = new Date();
var payoffDate = new Date(today.setMonth(today.getMonth() + numberOfPayments));
var monthNames = ["Jan", "Feb", "Mar", "Apr", "May", "Jun", "Jul", "Aug", "Sep", "Oct", "Nov", "Dec"];
var formattedDate = monthNames[payoffDate.getMonth()] + " " + payoffDate.getFullYear();
// 4. Update UI
document.getElementById('monthlyPayment').innerText = formatCurrency(totalMonthlyPayment);
document.getElementById('principalInterest').innerText = formatCurrency(monthlyPrincipalInterest);
document.getElementById('monthlyTax').innerText = formatCurrency(monthlyTax);
document.getElementById('monthlyInsurance').innerText = formatCurrency(monthlyInsurance);
document.getElementById('monthlyPMI').innerText = formatCurrency(monthlyPMI);
document.getElementById('totalLoanAmount').innerText = formatCurrency(principal);
document.getElementById('totalInterest').innerText = formatCurrency(totalInterest);
document.getElementById('payoffDate').innerText = formattedDate;
}
function formatCurrency(num) {
return "$" + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}