Estimate your monthly payments and total interest costs.
Monthly Principal & Interest:$0.00
Loan Amount:$0.00
Total Interest Paid:$0.00
Total Cost of Loan:$0.00
Understanding Your Mortgage Calculation
Purchasing a home is likely the largest financial commitment you will make in your lifetime. Using a Mortgage Payment Calculator is an essential step in the home-buying process. It helps you understand not just what you will pay every month, but how much the loan will cost you over its entire lifespan.
How Mortgage Payments Are Calculated
Your monthly mortgage payment is primarily determined by three factors. Understanding how these variables interact will help you choose the right loan product:
Principal: This is the amount of money you borrow. It is calculated by taking the home price and subtracting your down payment. A larger down payment reduces your principal and, consequently, your monthly payment.
Interest Rate: This is the cost of borrowing money, expressed as a percentage. Even a small difference in interest rates (e.g., 6.0% vs. 6.5%) can add up to tens of thousands of dollars in extra costs over a 30-year term.
Loan Term: The duration of the loan. The most common terms are 15 and 30 years. A 30-year loan offers lower monthly payments but results in higher total interest paid. A 15-year loan saves significantly on interest but requires higher monthly payments.
The Amortization Formula
Mortgages use an amortization formula to ensure your payments remain stable while the proportion of principal and interest changes over time. In the early years of your loan, the majority of your payment goes toward interest. As time passes, a larger portion is applied to the principal balance.
The standard formula used in this calculator is:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
Where M is the monthly payment, P is the principal loan amount, i is the monthly interest rate, and n is the number of payments.
Tips for Lowering Your Mortgage Costs
If the results from the calculator are higher than your budget allows, consider these strategies to lower your costs:
Increase Your Down Payment: Putting 20% down avoids Private Mortgage Insurance (PMI) and lowers your principal.
Improve Your Credit Score: Borrowers with higher credit scores qualify for lower interest rates.
Shop Around: Different lenders offer different rates. Comparison shopping can save you significant money.
Make Extra Payments: Applying extra money directly to the principal reduces the loan term and total interest paid.
What This Calculator Excludes
Please note that this calculation focuses on Principal and Interest (P&I). A typical monthly housing payment also includes:
Property Taxes
Homeowners Insurance
Private Mortgage Insurance (if down payment is under 20%)
HOA Fees (if applicable)
Be sure to budget an additional 20-30% on top of the calculated P&I figure to account for these "escrow" expenses.
function calculateMortgage() {
// 1. Get Input Values
var homePriceInput = document.getElementById('homePrice');
var downPaymentInput = document.getElementById('downPayment');
var interestRateInput = document.getElementById('interestRate');
var loanTermInput = document.getElementById('loanTerm');
var errorDiv = document.getElementById('errorDisplay');
var resultsDiv = document.getElementById('mortgageResults');
// 2. Parse values to numbers
var price = parseFloat(homePriceInput.value);
var down = parseFloat(downPaymentInput.value);
var rate = parseFloat(interestRateInput.value);
var term = parseFloat(loanTermInput.value);
// 3. Reset error state
errorDiv.style.display = 'none';
errorDiv.innerHTML = ";
resultsDiv.style.display = 'none';
// 4. Validation
if (isNaN(price) || isNaN(down) || isNaN(rate) || isNaN(term)) {
errorDiv.innerHTML = 'Please fill in all fields with valid numbers.';
errorDiv.style.display = 'block';
return;
}
if (price <= 0 || term = price) {
errorDiv.innerHTML = 'Down payment cannot be greater than or equal to the home price.';
errorDiv.style.display = 'block';
return;
}
// 5. Calculation Logic
var principal = price – down;
var monthlyRate = rate / 100 / 12;
var numberOfPayments = term * 12;
var monthlyPayment = 0;
// Handle zero interest rate edge case
if (rate === 0) {
monthlyPayment = principal / numberOfPayments;
} else {
// Standard Amortization Formula: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
var x = Math.pow(1 + monthlyRate, numberOfPayments);
monthlyPayment = (principal * x * monthlyRate) / (x – 1);
}
var totalPayment = monthlyPayment * numberOfPayments;
var totalInterest = totalPayment – principal;
// 6. Formatting Helper
function formatCurrency(num) {
return '$' + num.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,');
}
// 7. Update DOM
document.getElementById('monthlyPayment').innerHTML = formatCurrency(monthlyPayment);
document.getElementById('loanAmountResult').innerHTML = formatCurrency(principal);
document.getElementById('totalInterest').innerHTML = formatCurrency(totalInterest);
document.getElementById('totalCost').innerHTML = formatCurrency(totalPayment);
// 8. Show Results
resultsDiv.style.display = 'block';
}