Calculating your monthly mortgage payment is the first critical step in the home buying process. This Mortgage Payment Calculator provides a comprehensive breakdown of your financial obligations, helping you determine exactly how much house you can afford. Unlike simple calculators that only look at the loan principal, our tool factors in property taxes and homeowners insurance for a realistic view of your monthly housing costs.
How the Mortgage Formula Works
A standard mortgage payment is comprised of four main components, often referred to as PITI:
Principal: The portion of your payment that reduces the loan balance.
Interest: The cost of borrowing money, determined by your interest rate.
Taxes: Property taxes charged by your local government, usually held in escrow.
Insurance: Homeowners insurance to protect against damage, also typically held in escrow.
Why Interest Rates Matter
Even a small fluctuation in interest rates can significantly impact your monthly payment and the total cost of the loan. For example, on a $300,000 loan, a 1% increase in interest rate can add hundreds of dollars to your monthly payment and tens of thousands of dollars to the total interest paid over a 30-year term. Use the input fields above to test different scenarios and see how refinancing or shopping for a better rate could save you money.
Tips for Lowering Your Payment
If the estimated payment generated by the calculator is higher than your budget allows, consider the following strategies:
Increase your down payment: This lowers the principal loan amount.
Extend the loan term: Switching from a 15-year to a 30-year term lowers monthly payments, though you will pay more interest over time.
Shop for insurance: Homeowners insurance premiums vary wildly; shopping around can reduce your monthly escrow requirements.
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 termYears = parseFloat(document.getElementById('loanTerm').value);
var yearlyTax = parseFloat(document.getElementById('propertyTax').value);
var yearlyInsurance = parseFloat(document.getElementById('homeInsurance').value);
// 2. Validate inputs
if (isNaN(homePrice) || homePrice <= 0) {
alert("Please enter a valid Home Price.");
return;
}
if (isNaN(downPayment) || downPayment < 0) {
downPayment = 0;
}
if (isNaN(interestRate) || interestRate < 0) {
alert("Please enter a valid Interest Rate.");
return;
}
if (isNaN(yearlyTax)) yearlyTax = 0;
if (isNaN(yearlyInsurance)) yearlyInsurance = 0;
// 3. Perform Calculations
var loanAmount = homePrice – downPayment;
if (loanAmount <= 0) {
alert("Down payment cannot be greater than or equal to Home Price.");
return;
}
var monthlyTax = yearlyTax / 12;
var monthlyInsurance = yearlyInsurance / 12;
// Interest calculation
var monthlyInterestRate = (interestRate / 100) / 12;
var numberOfPayments = termYears * 12;
var monthlyPrincipalAndInterest = 0;
// Handle zero interest case
if (interestRate === 0) {
monthlyPrincipalAndInterest = loanAmount / numberOfPayments;
} else {
// Standard amortization formula: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
var x = Math.pow(1 + monthlyInterestRate, numberOfPayments);
monthlyPrincipalAndInterest = (loanAmount * monthlyInterestRate * x) / (x – 1);
}
var totalMonthlyPayment = monthlyPrincipalAndInterest + monthlyTax + monthlyInsurance;
var totalCostOfLoan = (monthlyPrincipalAndInterest * numberOfPayments);
var totalInterestPaid = totalCostOfLoan – loanAmount;
// 4. Update UI
document.getElementById('mortgageResult').style.display = 'block';
// Format currency helper
var formatter = new Intl.NumberFormat('en-US', {
style: 'currency',
currency: 'USD',
minimumFractionDigits: 2
});
document.getElementById('totalMonthlyPayment').innerHTML = formatter.format(totalMonthlyPayment);
document.getElementById('piResult').innerHTML = formatter.format(monthlyPrincipalAndInterest);
document.getElementById('taxResult').innerHTML = formatter.format(monthlyTax);
document.getElementById('insResult').innerHTML = formatter.format(monthlyInsurance);
document.getElementById('loanAmountResult').innerHTML = formatter.format(loanAmount);
document.getElementById('totalInterestResult').innerHTML = formatter.format(totalInterestPaid);
}