Use our powerful and accurate tool to quickly determine your estimated monthly mortgage payment and the total cost of the loan, factoring in your down payment.
Mortgage Calculator with Down Payment
Estimated Monthly Payment
Mortgage Calculator Formula
Where:
- P = Monthly Loan Payment
- L = Principal Loan Amount (Home Price – Down Payment)
- i = Monthly Interest Rate (Annual Rate / 1200)
- n = Total Number of Payments (Loan Term in Years * 12)
Formula Source: Investopedia Mortgage Calculation
Variables Used in the Calculator
- Home Price: The total purchase price of the property before any payments.
- Down Payment: The initial lump sum you pay upfront. This directly reduces the Principal Loan Amount.
- Annual Interest Rate (%): The annual rate charged on the loan principal. This is compounded monthly.
- Loan Term (Years): The duration over which the loan will be repaid (e.g., 15 years, 30 years).
What is Mortgage Calculator with Down Payment?
A mortgage calculator with a down payment field is an essential financial tool that estimates your expected monthly housing expenses. By including the down payment, the calculator accurately determines the *actual* amount you will be borrowing (the principal loan amount).
This is crucial because the down payment reduces the principal, leading to a lower overall monthly payment and significantly less interest paid over the life of the loan compared to financing 100% of the property cost. It provides a realistic outlook on affordability.
The calculation is based on an amortization schedule, assuming fixed interest and consistent monthly payments that cover both principal and interest over the entire loan term.
How to Calculate Mortgage (Example)
- Determine Loan Principal (L): Subtract the Down Payment from the Home Price. (e.g., $300,000 – $60,000 = $240,000)
- Calculate Monthly Rate (i): Divide the Annual Interest Rate by 12 and 100. (e.g., 6.0% / 1200 = 0.005)
- Calculate Total Payments (n): Multiply the Loan Term (in years) by 12. (e.g., 30 years * 12 = 360)
- Apply the Formula: Use the amortization formula with L, i, and n to find the fixed Monthly Payment (P).
- Calculate Total Cost: Multiply the Monthly Payment (P) by the total number of payments (n), then add the initial Down Payment.
Frequently Asked Questions (FAQ)
Is the down payment included in the total cost?
Yes, the total cost of the loan is calculated as (Monthly Payment * Loan Term) + Down Payment.
What is a good down payment percentage?
A 20% down payment is often considered ideal because it helps you avoid paying Private Mortgage Insurance (PMI), which adds to your monthly cost.
Does this calculator include property taxes or insurance?
No, this calculator focuses solely on the principal and interest payment (P&I). You must budget separately for property taxes, insurance, and HOA fees.
Can I calculate a 15-year mortgage?
Yes, simply enter “15” into the Loan Term (Years) field to calculate the payments for a 15-year term.