Mortgage Calculator : Plan Your Home Purchase with Confidence

Buying a home is one of the most significant investments you’ll make in your lifetime. To help you plan this journey, our Mortgage Calculator offers a comprehensive overview of your potential monthly payments, down payments, and more.

Mortgage Payment Calculator

? This is the purchase price of the home you are looking to buy.
? This is the initial sum of money you pay upfront. You can enter it as a specific amount or as a percentage of the home price.
? This is the annual rate charged by the lender to borrow the loan amount.
? This is the total duration (in years) over which you will repay the mortgage.
? Private Mortgage Insurance (PMI) is typically required when the down payment is less than 20%. You can enter the PMI as a specific amount or as a percentage of the loan amount.
? This is the annual tax levied on your property. You can enter it as a specific amount or as a percentage of the home price.
? This is the annual insurance premium to protect your home against damages.


Your Monthly Payment Is:

Down Payment:

Total Principal Paid:

Total Interest Paid:

Total Tax Paid Over Loan Term:

Total Home Insurance Paid Over Loan Term:

Estimated Payoff Date:

Total Number of Payments:

Total Payments (Including Taxes, Insurance, PMI):

Mortgage Loan Formulas and Calculations:

Monthly Mortgage Payment:

A monthly mortgage payment is the amount you are required to pay to the lender every month until the mortgage is fully paid off. This payment primarily covers the loan principal and the interest, but it often includes other costs like property taxes, homeowner’s insurance, and possibly homeowner’s association (HOA) fees or private mortgage insurance (PMI).

M = (P * r * (1 + r)n) / (1 + r)n – 1

Meaning Of Formular’s Variables:

  • is your monthly payment.
  • is the principal loan amount (Home Price – Down Payment).
  • is your monthly interest rate (Annual Interest Rate divided by 12).
  • is your number of monthly payments (Term in years * 12).

Down Payment:

The down payment is a crucial part of purchasing a home. It’s the upfront amount you pay when buying the property, and it’s typically expressed as a percentage of the home’s purchase price. This payment reduces the amount you will need to borrow (the principal), and often, a larger down payment can lead to better mortgage terms.

In the provided mortgage calculator, the down payment can be specified in two ways:

  1. => As a specific amount (in dollars or in any currency).
  2. => As a percentage of the home price.

Formulas for Down Payment:

1. When Given as a Percentage: If you know the percentage of the home price you’re going to pay as a down payment, you can calculate the actual amount using this formula:

Down Payment Amount = Down Payment Percentage * Home Price / 100

For example, if you’re buying a home for $200,000 and plan to make a 20% down payment, the amount you’d pay upfront would be:

2. When Given as an Amount: If you’ve already decided on a specific amount you want to pay upfront, irrespective of the percentage it represents, you can directly input this amount. To find out what percentage of the home price this amount represents, you can use the formula:

Down Payment Percentage = (Down Payment Amount / Home Price) * 100

For instance, if you’re putting down $50,000 on a $250,000 home, the down payment percentage would be:

Why Down Payment Matters:

The down payment has a direct impact on your mortgage terms:

  • Loan Amount: The more you pay as a down payment, the less you’ll need to borrow. This means lower monthly mortgage payments and potentially paying less interest over the life of the loan.

  • Interest Rates: Lenders might offer better interest rates to those who make larger down payments because it represents a lower risk for them.

  • Private Mortgage Insurance (PMI): If you pay less than 20% of the home’s price as a down payment, lenders usually require you to pay PMI, which is an added monthly cost.

Knowing how to calculate and understand the down payment can help you make informed decisions about your home purchase.

Private Mortgage Insurance (PMI):

PMI, or Private Mortgage Insurance, is a type of mortgage insurance used with conventional loans. It’s designed to protect the lender if you default on your mortgage. PMI is typically required by lenders when a borrower cannot make a down payment of at least 20% of the home’s purchase price.

How is PMI Calculated?

PMI is typically calculated as a percentage of the original loan amount and is paid on a monthly basis. The rate for PMI can vary based on the size of the down payment and the loan, but it generally ranges from 0.3% to 1.5% of the original loan amount per year.

The formula to calculate PMI amount on a monthly basis is:

Monthly PMI Amount = (PMI Rate/12) * Loan Amount

Meaning of the Formula:

  • is the annual PMI rate (as a decimal).
  • is the total amount you’re borrowing, which is the home price minus the down payment.

Why is PMI Used?

  • Lower Down Payment: PMI allows buyers to purchase a home with a smaller down payment. Without PMI, many buyers would need to wait longer to accumulate the traditional 20% down payment.

  • Protection for Lenders: Lenders take on more risk when they allow buyers to make a smaller down payment. If a borrower defaults, the lender’s loss is covered by the PMI.

Property Tax:

Property tax is a levy on property that the owner is required to pay. The tax is levied by the governing authority of the jurisdiction in which the property is located. This can be a national government, a federated state, a county or geographical region, or a municipality.

How is Property Tax Calculated?

The amount of property tax owed depends on the appraised fair market value of the property, as determined by the property tax assessor. The tax rate can be set as a percentage or as an annual fee.

The general formula for calculating property tax is:

Property Tax = Property Value * Tax Rate

Meaning of the formula:

  • Property Value is the appraised value of the property.
  • is the rate set by the local government, often expressed as a percentage.