function calculateMortgage() {
// 1. Get Values
var homePrice = parseFloat(document.getElementById('homePrice').value);
var downPayment = parseFloat(document.getElementById('downPayment').value);
var loanTermYears = parseInt(document.getElementById('loanTerm').value);
var interestRateAnnual = parseFloat(document.getElementById('interestRate').value);
var annualTax = parseFloat(document.getElementById('propertyTax').value);
var annualInsurance = parseFloat(document.getElementById('homeInsurance').value);
var monthlyHOA = parseFloat(document.getElementById('hoaFees').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(interestRateAnnual) || interestRateAnnual < 0) {
alert("Please enter a valid interest rate.");
return;
}
if (isNaN(annualTax)) annualTax = 0;
if (isNaN(annualInsurance)) annualInsurance = 0;
if (isNaN(monthlyHOA)) monthlyHOA = 0;
// 3. Core Calculations
var principal = homePrice – downPayment;
// Check if downpayment exceeds home price
if (principal 0) {
var x = Math.pow(1 + monthlyInterestRate, numberOfPayments);
monthlyPrincipalInterest = principal * ((monthlyInterestRate * x) / (x – 1));
} else {
// If 0% interest rate
monthlyPrincipalInterest = principal / numberOfPayments;
}
var monthlyTax = annualTax / 12;
var monthlyInsurance = annualInsurance / 12;
var totalMonthlyPayment = monthlyPrincipalInterest + monthlyTax + monthlyInsurance + monthlyHOA;
var totalPaymentOverLife = (monthlyPrincipalInterest * numberOfPayments);
var totalInterest = totalPaymentOverLife – principal;
var totalCost = totalPaymentOverLife + downPayment; // Total cost including down payment
// 4. Update UI
document.getElementById('displayTotalMonthly').innerHTML = "$" + totalMonthlyPayment.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",");
document.getElementById('displayPrincipalInterest').innerHTML = "$" + monthlyPrincipalInterest.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",");
document.getElementById('displayMonthlyTax').innerHTML = "$" + monthlyTax.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",");
document.getElementById('displayMonthlyInsurance').innerHTML = "$" + monthlyInsurance.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",");
document.getElementById('displayMonthlyHOA').innerHTML = "$" + monthlyHOA.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",");
document.getElementById('displayTotalInterest').innerHTML = "$" + totalInterest.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",");
document.getElementById('displayTotalCost').innerHTML = "$" + totalCost.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",");
// Show Results
document.getElementById('resultsArea').style.display = 'block';
}
Understanding Your Mortgage Calculation
Purchasing a home is likely the largest financial decision you will make in your lifetime. Understanding how your monthly mortgage payment is calculated is crucial for budgeting and financial planning. This calculator helps break down the costs associated with home ownership, moving beyond just the loan repayment to include taxes, insurance, and HOA fees.
Components of Your Monthly Payment (PITI)
Mortgage experts often refer to the components of a mortgage payment as PITI:
Principal: The portion of your payment that goes toward paying down the original loan amount. In the early years of a 30-year mortgage, this portion is small but grows over time.
Interest: The fee charged by the lender for borrowing the money. Initially, this makes up the bulk of your monthly payment.
Taxes: Property taxes assessed by your local government. Lenders often collect this monthly and hold it in an escrow account to pay the annual bill on your behalf.
Insurance: Homeowners insurance protects your property against damage. Like taxes, this is often collected monthly into escrow.
How Interest Rates Affect Your Payment
Even a small change in interest rates can have a significant impact on your monthly payment and the total interest paid over the life of the loan. For example, on a $300,000 loan, a 1% increase in interest rate can increase your monthly payment by hundreds of dollars and your total interest cost by over $60,000 over 30 years.
The Impact of the Down Payment
Your down payment affects your loan in two major ways. First, it reduces the principal loan amount, which lowers your monthly principal and interest payment. Second, if you put down less than 20% of the home's value, you may be required to pay Private Mortgage Insurance (PMI), which is an additional monthly cost not included in the standard calculation above unless added to the insurance field.
30-Year vs. 15-Year Mortgages
Choosing your loan term is a trade-off between monthly affordability and long-term savings. A 30-year term offers lower monthly payments, making the home more affordable day-to-day, but you will pay significantly more in interest over the life of the loan. A 15-year term will have higher monthly payments, but you will own your home sooner and save a substantial amount on interest.