A mortgage loan is a significant financial commitment, and understanding how your monthly payment is calculated is crucial for budgeting and financial planning. This calculator helps you estimate your principal and interest payment based on the loan amount, annual interest rate, and loan term.
The Math Behind the Mortgage Payment
The most common mortgage payment formula used in the US is the one for a fixed-rate mortgage. It calculates the constant monthly payment (P&I) required to fully amortize the loan over its term. The formula is derived from the present value of an annuity.
The formula 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 4.5%, your monthly rate is 0.045 / 12 = 0.00375.
n = The total number of payments over the loan's lifetime. This is calculated by multiplying your loan term in years by 12. For a 30-year mortgage, n = 30 * 12 = 360.
How to Use the Calculator
Loan Amount: Enter the total amount you intend to borrow for the home purchase.
Annual Interest Rate: Input the yearly interest rate offered by your lender (e.g., 4.5 for 4.5%).
Loan Term (Years): Specify the duration of the loan in years (commonly 15 or 30 years).
Clicking "Calculate Monthly Payment" will provide an estimate of your P&I payment and break down the total principal, total interest paid over the life of the loan, and the total amount you will repay.
Important Considerations:
This calculator estimates the Principal and Interest (P&I) portion of your monthly mortgage payment. It does NOT include other costs that are typically part of your total monthly housing expense, such as:
Property Taxes: Annual taxes assessed by your local government.
Homeowner's Insurance: Insurance to protect your property against damage or loss.
Private Mortgage Insurance (PMI): Often required if your down payment is less than 20% of the home's price.
HOA Fees: If applicable to your property.
These additional costs, often referred to as PITI (Principal, Interest, Taxes, and Insurance), will increase your actual total monthly housing payment. Always consult with a mortgage professional for a complete and accurate loan estimate.
Disclaimer:
This calculator is for estimation purposes only. Loan terms, rates, and payments can vary based on individual creditworthiness, lender policies, market conditions, and other factors. Consult with a qualified mortgage lender or financial advisor for personalized advice.
function calculateMortgage() {
var loanAmount = parseFloat(document.getElementById("loanAmount").value);
var annualInterestRate = parseFloat(document.getElementById("interestRate").value);
var loanTermYears = parseInt(document.getElementById("loanTerm").value);
var resultDiv = document.getElementById("result");
var monthlyPaymentSpan = document.getElementById("monthlyPayment");
var totalPrincipalSpan = document.getElementById("totalPrincipal");
var totalInterestSpan = document.getElementById("totalInterest");
var totalAmountPaidSpan = document.getElementById("totalAmountPaid");
// Clear previous results if any input is invalid
monthlyPaymentSpan.innerText = "$0.00";
totalPrincipalSpan.innerText = "$0.00";
totalInterestSpan.innerText = "$0.00";
totalAmountPaidSpan.innerText = "$0.00";
if (isNaN(loanAmount) || loanAmount <= 0 ||
isNaN(annualInterestRate) || annualInterestRate < 0 ||
isNaN(loanTermYears) || loanTermYears 0) {
monthlyPayment = loanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else { // Handle 0% interest rate case
monthlyPayment = loanAmount / numberOfPayments;
}
var totalAmountPaid = monthlyPayment * numberOfPayments;
var totalInterest = totalAmountPaid – loanAmount;
// Format currency
var formatter = new Intl.NumberFormat('en-US', {
style: 'currency',
currency: 'USD',
});
monthlyPaymentSpan.innerText = formatter.format(monthlyPayment);
totalPrincipalSpan.innerText = formatter.format(loanAmount);
totalInterestSpan.innerText = formatter.format(totalInterest);
totalAmountPaidSpan.innerText = formatter.format(totalAmountPaid);
}