Calculate monthly mortgage payment with down payment. Free mortgage calculator.
A mortgage is likely the largest financial commitment most people will ever make, stretching over 15 to 30 years with hundreds of thousands of dollars in total payments. Understanding your monthly payment before house hunting helps you set a realistic budget and avoid falling in love with a property you cannot comfortably afford. This calculator uses the standard fixed-rate mortgage amortization formula to compute your monthly principal and interest payment, total interest over the life of the loan, and total amount repaid. Enter the home price, down payment, interest rate, and loan term to see a complete picture of your mortgage costs.
The calculator subtracts your down payment from the home price to determine the loan amount. It then applies the standard amortization formula to calculate the fixed monthly payment of principal and interest. Total interest is computed by multiplying the monthly payment by the number of payments and subtracting the original loan amount. Note that actual mortgage payments also include property taxes, homeowners insurance, and potentially private mortgage insurance, which are not included in this basic calculation.
First-time home buyers estimate monthly payments at various price points. Homeowners considering refinancing compare their current payment against potential new terms. Real estate investors analyze rental property cash flow by comparing mortgage payments to expected rental income. Financial advisors help clients understand the impact of different down payment amounts on monthly costs and total interest.
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Conventional mortgages traditionally require 20% down to avoid private mortgage insurance (PMI). However, many programs allow lower down payments: FHA loans require as little as 3.5%, VA loans may require 0%, and some conventional programs accept 3% to 5%. A smaller down payment means a larger loan and higher monthly payments.
A 15-year mortgage has higher monthly payments but significantly lower total interest. For a $300,000 loan at 6%, the 30-year payment is about $1,799 with $347,515 in total interest, while the 15-year payment is about $2,532 but with only $155,683 in total interest, saving nearly $192,000.
A complete mortgage payment typically includes principal repayment, interest charges, property taxes, and homeowners insurance, often abbreviated as PITI. If your down payment is less than 20%, you may also pay private mortgage insurance. This calculator shows the principal and interest portion only.
Extra principal payments can save significant interest and shorten your loan term. Even small additional monthly amounts compound over time. However, compare your mortgage interest rate against potential investment returns. If your mortgage rate is 3.5% but you could earn 7% investing, the math may favor investing the extra money instead.
An adjustable-rate mortgage (ARM) starts with a fixed rate for an initial period, typically 5, 7, or 10 years, then adjusts periodically based on a market index. ARMs often offer lower initial rates than fixed-rate mortgages but carry the risk of higher payments after the fixed period ends. This calculator models fixed-rate mortgages only.