How is a mortgage payment calculated?
Your principal and interest payment uses the standard amortization formula: M = P·r / (1 − (1 + r)−n), where P is the loan amount, r the monthly interest rate and n the number of payments. Property tax, insurance, PMI and HOA dues are added on top.
Frequently asked questions
What is PMI and how do I avoid it?
Private mortgage insurance protects the lender when you put down less than 20%. It's usually 0.3–1.5% of the loan per year and can be removed once you reach 20% equity.
15-year or 30-year mortgage?
A 15-year loan has a higher monthly payment but typically a lower rate and far less total interest. Try both terms above to compare.
Do extra payments really help?
Yes. Extra principal reduces the balance that interest is charged on. Enter an amount above to see exactly how much you'd save.
Estimates for illustration only, not financial advice. Your lender's figures may differ.