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Home Price

$

Down Payment

$

d

%

Loan Term

*

Year

Interest Rate

%

Total principal & interest = $1,825.19

Monthly payment breakdown

Total principal & interest = $1,825.19

Property Tax

+

Property Tax

$

Homeowner's insurance

+

Homeowner's insurance

$

PMI

+

PMI

$

HOA fees

+

HOA fees

$

Total monthly payment

= $2,171.19

How to Calculate Your Mortgage PaymentsCalculating mortgage payments can seem daunting, but with TipRank's Mortgage Calculator, you can effortlessly navigate through the numbers.### Home Price

### Down Payment

### Loan Term

### Interest Rate

Enter the purchase price if you're buying a new home, or the current market value if you're refinancing your existing property.

Specify the amount you plan to pay upfront if you're buying, or the equity you've built up if you're refinancing. Down payment refers to the initial lump-sum payment towards the home, while home equity is the property's value minus any outstanding loans. You can input this as either a dollar amount or a percentage.

Choose the duration of your loan. Common terms are 30, 20, 15, or 10 years, but you're free to select a term that suits your financial situation.

Input the interest rate you anticipate. Keep in mind that rates may differ depending on whether you're purchasing a new home or refinancing an existing loan. As you populate these fields, the calculator will dynamically update its calculations to display your estimated monthly principal and interest payments.

Glossary of Mortgage Terms### Amortization

### Annual Percentage Rate (APR)

### Closing Costs

### Down Payment

### Equity

### Escrow

### Fixed-Rate Mortgage

### Interest

### Loan-to-Value Ratio (LTV)

### Mortgage Insurance

### Principal

### Refinancing

### Term

### Underwriting

### Variable-Rate Mortgage (or Adjustable-Rate Mortgage)

The process of paying off a loan over time through regular payments. An amortization schedule details how much of each payment goes toward the principal and how much goes toward interest.

The annual rate charged for borrowing, expressed as a single percentage that represents the actual yearly cost of the loan.

One-time fees and expenses paid at the closing of a mortgage transaction, separate from the loan itself.

The initial upfront payment made when buying a home, usually expressed as a percentage of the total property price.

The value of ownership built up in a property, calculated by taking the current market value minus the remaining mortgage balance.

An account held by a third party to manage the payment of property taxes and insurance.

A mortgage with an interest rate that remains the same for the entire term of the loan.

The cost of borrowing money, typically expressed as an annual percentage rate.

The ratio of the loan amount to the appraised value or sales price of the property, expressed as a percentage.

Insurance that protects the lender in case the borrower defaults on the loan. Typically required for loans with an LTV ratio greater than 80%.

The original amount of money borrowed, not including interest.

The process of obtaining a new mortgage to replace an existing one, often to obtain a lower interest rate or to convert equity into cash.

The length of time over which the loan must be repaid. Common terms are 15, 20, or 30 years.

The process lenders use to evaluate the risk of offering a mortgage to a borrower, including creditworthiness and the value of the property.

A mortgage with an interest rate that may change periodically depending on market conditions, affecting the monthly payment.

Understanding the Mortgage Payment FormulaWhen it comes to calculating your mortgage payments, a specific formula is used to determine how much you'll owe each month. While our mortgage calculator handles these calculations automatically, knowing the formula can help you understand the financial mechanics behind your loan.### The Formula

### Breaking Down the Formula

the monthly rate would be . Your annual interest rate divided by 12 (the number of months in a year). For example, if your annual interest rate is 6%, ### Example

The standard formula to calculate a monthly mortgage payment is:

$M=P\times \frac{r\cdot (1+r){}^{n}}{(1+r){}^{n}-1}$

Where:

$M$ = Monthly payment

$P$ = Principal loan amount

$r$ = Monthly interest rate (annual interest rate divided by 12)

$n$ = Number of payments (loan term in months)

This is the amount you'll pay each month, which includes both the principal and the interest.

This is the initial amount borrowed to purchase the home.

the monthly rate would be .

This is the total number of monthly payments you'll make over the life of the loan. For a 30-year term, n = 30 × 12 = 360.

Let's say you have a $300,000 loan with a 4% annual interest rate, and you've chosen a 30-year term.

To find the monthly interest rate, you would divide the annual rate by 12: or 0.33% in decimal form.

Plugging these into the formula, your monthly payment would be calculated as follows:

To find the monthly interest rate, you would divide the annual rate by 12: or 0.33% in decimal form.

Plugging these into the formula, your monthly payment would be calculated as follows:

$M=\mathrm{300,000}\times \frac{(1+0.00333){}^{360}-1}{0.00333(1+0.00333){}^{360}}\approx \mathrm{1,432.25}$

In this example, your estimated monthly mortgage payment would be approximately $1,432.25.

What is a mortgage calculator?

A mortgage calculator is an online tool that helps you estimate your monthly mortgage payments based on various factors such as loan amount, interest rate, and loan term.

Who should use this mortgage calculator?

This calculator is useful for anyone looking to buy a new home, refinance an existing mortgage, or gain a better understanding of their current or potential mortgage payments.

How do I use the mortgage calculator?

Simply enter the home price, down payment, loan term, and interest rate into the appropriate fields. The calculator will then display your estimated monthly mortgage payment.

What does the monthly payment include?

The monthly payment estimate includes both the principal and the interest. It does not include property taxes, homeowners insurance, or any potential mortgage insurance.

Can I calculate payments for different loan terms?

Yes, you can select different loan terms to see how it affects your monthly payment and the total amount paid over the life of the loan.

Does the calculator account for variable interest rates?

No, this calculator is designed for fixed-rate mortgages. For variable-rate mortgages, the interest rate and payments may change over time.