Buying a home is one of the most significant financial decisions you will make. This Mortgage Payment Calculator is designed to provide a comprehensive breakdown of your monthly financial obligations, going beyond just the principal and interest to include critical escrow components like property taxes and homeowners insurance.
The Components of Your Monthly Payment (PITI)
Mortgage lenders often refer to your payment as PITI, which stands for:
Principal: The portion of your payment that reduces the loan balance.
Interest: The cost of borrowing money from the lender.
Taxes: Property taxes charged by your local municipality, usually held in an escrow account.
Insurance: Homeowners insurance to protect against damage, also typically held in escrow.
Additionally, if you buy a condo or a home in a planned community, you may have HOA (Homeowners Association) fees, which we include in this calculation to give you a true picture of your housing costs.
How Interest Rates Impact Your Loan
Even a small difference in interest rates can drastically change your monthly payment and the total interest paid over the life of the loan. For example, on a $300,000 loan, the difference between a 6% and a 7% interest rate can amount to hundreds of dollars a month and tens of thousands over 30 years.
15-Year vs. 30-Year Mortgages
Choosing your loan term is a trade-off between monthly affordability and long-term savings:
30-Year Term: Lower monthly payments make the home more affordable month-to-month, but you will pay significantly more in interest over the life of the loan.
15-Year Term: Higher monthly payments, but you build equity much faster and pay far less total interest.
Formula Used for Calculation
This calculator uses the standard amortization formula to determine your Principal and Interest (P&I) payment:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
Where:
M = Total monthly P&I payment
P = Principal loan amount (Home Price – Down Payment)
i = Monthly interest rate (Annual Rate / 12)
n = Number of payments (Loan Term in Years × 12)
// Initialize with a sane down payment logic on load just in case (optional, but let's keep it strictly logical)
(function() {
var price = document.getElementById('mcHomePrice');
var dp = document.getElementById('mcDownPayment');
if(price && dp && dp.value > price.value) {
dp.value = price.value * 0.2; // Reset to 20% if invalid on load
}
})();
function calculateMortgage() {
// 1. Get Input Values
var homePrice = parseFloat(document.getElementById('mcHomePrice').value);
var downPayment = parseFloat(document.getElementById('mcDownPayment').value);
var interestRate = parseFloat(document.getElementById('mcInterestRate').value);
var loanTermYears = parseInt(document.getElementById('mcLoanTerm').value);
var propertyTaxAnnual = parseFloat(document.getElementById('mcPropertyTax').value);
var insuranceAnnual = parseFloat(document.getElementById('mcInsurance').value);
var hoaMonthly = parseFloat(document.getElementById('mcHOA').value);
var errorDiv = document.getElementById('mcError');
var resultDiv = document.getElementById('mcResults');
// 2. Validation
if (isNaN(homePrice) || isNaN(downPayment) || isNaN(interestRate) || isNaN(loanTermYears)) {
errorDiv.style.display = 'block';
errorDiv.innerText = "Please enter valid numbers for all fields.";
resultDiv.style.display = 'none';
return;
}
if (downPayment >= homePrice) {
errorDiv.style.display = 'block';
errorDiv.innerText = "Down payment cannot be equal to or greater than the home price.";
resultDiv.style.display = 'none';
return;
}
errorDiv.style.display = 'none';
// 3. Core Calculations
var principal = homePrice – downPayment;
var monthlyInterestRate = (interestRate / 100) / 12;
var numberOfPayments = loanTermYears * 12;
// Amortization Formula: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
var monthlyPrincipalInterest = 0;
if (interestRate === 0) {
monthlyPrincipalInterest = principal / numberOfPayments;
} else {
var mathPower = Math.pow(1 + monthlyInterestRate, numberOfPayments);
monthlyPrincipalInterest = principal * ((monthlyInterestRate * mathPower) / (mathPower – 1));
}
var monthlyTax = propertyTaxAnnual / 12;
var monthlyInsurance = insuranceAnnual / 12;
var totalMonthlyPayment = monthlyPrincipalInterest + monthlyTax + monthlyInsurance + hoaMonthly;
var totalPaymentOverLife = (monthlyPrincipalInterest * numberOfPayments);
var totalInterestPaid = totalPaymentOverLife – principal;
// 4. Formatting Helper Function
function formatCurrency(num) {
return '$' + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
// 5. Update DOM
document.getElementById('mcTotalMonthly').innerText = formatCurrency(totalMonthlyPayment);
document.getElementById('mcPrincipalInterest').innerText = formatCurrency(monthlyPrincipalInterest);
document.getElementById('mcMonthlyTax').innerText = formatCurrency(monthlyTax);
document.getElementById('mcMonthlyInsurance').innerText = formatCurrency(monthlyInsurance);
document.getElementById('mcMonthlyHOA').innerText = formatCurrency(hoaMonthly);
document.getElementById('mcLoanAmount').innerText = formatCurrency(principal);
document.getElementById('mcTotalInterest').innerText = formatCurrency(totalInterestPaid);
// Show Results
resultDiv.style.display = 'block';
}