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Estimate your monthly mortgage payments using the interactive tool below.

How Mortgage Payments Are Calculated

A comprehensive monthly mortgage payment is often referred to as PITI :

Principal: The actual money that goes toward paying down the original loan balance. Interest: The fee charged by the lender for borrowing the money, based on your interest rate. Taxes: Local property taxes assessed by your government, usually divided into 12 monthly installments. Insurance: Homeowners insurance to protect the property. If your down payment is less than 20%, you may also have to pay Private Mortgage Insurance (PMI) until you build enough equity.

The Mathematical Formula

To calculate just the base Principal and Interest (P&I) payment, calculators use the standard amortization formula:

M = P r ( 1 + r ) n ( 1 + r ) n − 1 cap M equals cap P the fraction with numerator r open paren 1 plus r close paren to the n-th power and denominator open paren 1 plus r close paren to the n-th power minus 1 end-fraction 𝑀 = 𝑃 𝑟 ( 1 + 𝑟 ) 𝑛 ( 1 + 𝑟 ) 𝑛 − 1

Where:

M = Total monthly principal and interest payment P = Principal loan amount (Purchase price minus down payment) r = Monthly interest rate (Annual interest rate divided by 12) n = Total number of monthly payments (e.g., 360 payments for a 30-year loan)