function calculateMortgage() {
// 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 loanTerm = parseFloat(document.getElementById("loanTerm").value);
var propertyTax = parseFloat(document.getElementById("propertyTax").value);
var homeInsurance = parseFloat(document.getElementById("homeInsurance").value);
// Validation
if (isNaN(homePrice) || isNaN(downPayment) || isNaN(interestRate) || isNaN(loanTerm)) {
alert("Please enter valid numbers for Home Price, Down Payment, Rate, and Term.");
return;
}
// Default 0 for optional fields if empty
if (isNaN(propertyTax)) propertyTax = 0;
if (isNaN(homeInsurance)) homeInsurance = 0;
// Calculate Loan variables
var principal = homePrice – downPayment;
var monthlyRate = (interestRate / 100) / 12;
var numberOfPayments = loanTerm * 12;
var monthlyPI = 0;
// Calculate Principal & Interest
if (interestRate === 0) {
monthlyPI = principal / numberOfPayments;
} else {
// M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
monthlyPI = principal * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
}
// Calculate Monthly Tax and Insurance
var monthlyTax = propertyTax / 12;
var monthlyInsurance = homeInsurance / 12;
// Total Monthly Payment
var totalMonthly = monthlyPI + monthlyTax + monthlyInsurance;
// Update the DOM
document.getElementById("resultBox").style.display = "block";
// Formatting currency
var formatter = new Intl.NumberFormat('en-US', {
style: 'currency',
currency: 'USD',
});
document.getElementById("totalMonthlyResult").innerHTML = formatter.format(totalMonthly);
document.getElementById("piResult").innerHTML = formatter.format(monthlyPI);
document.getElementById("taxResult").innerHTML = formatter.format(monthlyTax);
document.getElementById("insResult").innerHTML = formatter.format(monthlyInsurance);
}
Understanding Your Mortgage Estimate
Buying a home is one of the most significant financial decisions you will make in your lifetime. Our Mortgage Payment Calculator is designed to give you a clear, comprehensive view of what your monthly financial commitment will look like. Unlike basic calculators that only show Principal and Interest, this tool factors in critical additional costs like Property Taxes and Homeowners Insurance, which can significantly impact your monthly budget.
How Is Your Monthly Mortgage Payment Calculated?
Your total monthly mortgage payment is generally composed of four main parts, often referred to as PITI (Principal, Interest, Taxes, and Insurance):
Principal: This is the portion of your payment that goes directly toward paying down the loan balance (the Home Price minus your Down Payment).
Interest: This is the cost of borrowing money from your lender. The rate is determined by the broader economic market and your personal credit score. Early in your loan term, a larger percentage of your payment goes toward interest.
Property Taxes: Local governments assess taxes on real estate to fund services like schools and roads. This calculator estimates the monthly portion of your annual tax bill.
Homeowners Insurance: Lenders require insurance to protect the property against damage. Like taxes, this is often paid annually but collected monthly by the lender in an escrow account.
Why the Down Payment Matters
The size of your down payment affects your mortgage in two ways. First, a larger down payment reduces your Principal, which lowers your monthly payments. Second, if you put down less than 20% of the home price, lenders often require Private Mortgage Insurance (PMI), which is an extra cost not included in the standard calculation above. Aiming for a 20% down payment is the best way to avoid PMI and secure a lower interest rate.
Using This Calculator for Budgeting
When using this tool, don't just look at the maximum loan you can get approved for. Consider your Debt-to-Income (DTI) ratio. Financial experts generally recommend that your total housing costs should not exceed 28% of your gross monthly income. Adjust the "Home Price" and "Down Payment" fields in the calculator above to find a monthly payment that fits comfortably within your budget, allowing you to save for maintenance and other financial goals.
Interest Rates and Loan Terms
The "Loan Term" is the duration of your mortgage. The most common terms are 15 and 30 years. A 30-year fixed-rate mortgage offers lower monthly payments but results in paying more interest over the life of the loan. A 15-year mortgage has higher monthly payments, but you build equity faster and pay significantly less in total interest. Use the calculator to compare how switching from 30 to 15 years changes your monthly obligation.