Use this powerful and responsive monthly payment mortgage calculator to quickly determine your required principal and interest payment, total interest paid, and total cost of the loan.
Monthly Payment Mortgage Calculator
ESTIMATED MONTHLY PAYMENT (P&I)
$0.00
Total Interest Paid: $0.00
Monthly Payment Mortgage Calculator Formula:
The standard formula used to calculate a monthly mortgage payment (M) is based on the amortization formula. It calculates the principal and interest portion of your payment.
Where: M = Monthly Payment, P = Principal Loan Amount, $i$ = Monthly Interest Rate ($r / 12$), $n$ = Total Number of Payments ($t \times 12$).
Formula Sources: Investopedia, CFPB
Variables:
- Loan Amount (P): The total amount of money borrowed from the lender.
- Annual Interest Rate (R): The yearly percentage rate charged for borrowing the principal.
- Loan Term (T): The total number of years over which the loan will be repaid.
Related Calculators:
- Mortgage Refinance Savings Calculator
- Annualized Return Calculator
- Loan Amortization Schedule Tool
- Debt-to-Income Ratio Calculator
What is Monthly Payment Mortgage Calculator?:
A monthly payment mortgage calculator is a crucial financial tool designed to help prospective and current homeowners estimate their periodic housing expenses. Specifically, it computes the portion of your monthly payment that goes towards covering the principal loan amount and the accrued interest. This figure, often referred to as P&I (Principal and Interest), is the fixed core of your monthly mortgage obligation.
By allowing users to input the loan principal, the annual interest rate, and the loan term in years, the calculator applies the standard amortization formula to provide an immediate and accurate payment estimate. This transparency is vital for budgeting, as it prevents financial surprises and helps users determine affordability before committing to a long-term debt.
How to Calculate Monthly Payment Mortgage Calculator (Example):
Follow these steps to calculate the monthly payment for a $200,000 loan at a 6% annual rate over 30 years.
- Convert the Annual Rate to a Monthly Rate ($i$): Divide the annual rate by 12 and 100. (6% / 12 / 100 = 0.005).
- Calculate the Total Number of Payments ($n$): Multiply the loan term by 12. (30 years * 12 months/year = 360 payments).
- Calculate the Amortization Factor: Compute the bracketed part of the formula: $\left[ \frac{i (1+i)^n}{(1+i)^n – 1} \right]$. Using the numbers: $\left[ \frac{0.005 (1.005)^{360}}{(1.005)^{360} – 1} \right] \approx 0.0059955$.
- Determine the Monthly Payment (M): Multiply the Principal (P) by the Amortization Factor. ($200,000 \times 0.0059955 \approx \$1,199.10$).
- Estimate Total Interest: Subtract the principal from the total payments made ($\$1,199.10 \times 360 – \$200,000$).
Frequently Asked Questions (FAQ):
P&I stands for Principal and Interest. This is the portion of your monthly payment that covers the actual loan balance (Principal) and the cost of borrowing the money (Interest). It does not include taxes or insurance.
A 15-year mortgage typically has a lower interest rate and results in significantly less total interest paid. However, the 30-year mortgage offers a lower monthly payment, which provides more flexibility in your monthly budget.
No, this calculator only calculates the Principal and Interest (P&I) portion of your payment, which is fixed. Property taxes, homeowners insurance, and HOA fees (PITI components) vary by location and must be added separately.
If the rate is 0%, there is no interest. The monthly payment simplifies to the Loan Amount divided by the total number of payments (Loan Term in Years multiplied by 12).