Mortgage Payment Calculator
Planning to buy a home? Use this mortgage payment calculator to estimate your monthly payment based on the home price, down payment, interest rate, and loan term. Understanding your monthly mortgage obligation is crucial for budgeting and determining how much home you can afford. This calculator computes the principal and interest portion of your payment using the standard amortization formula. Property taxes, homeowner's insurance, and PMI are not included but should be factored into your total housing cost.
How This Calculation Works
The calculator uses the standard mortgage amortization formula. Your loan amount is the home price minus your down payment. The monthly payment is calculated using the loan principal, monthly interest rate, and total number of payments. Each payment includes both interest and principal, with early payments being mostly interest and later payments mostly principal. Lenders front-load interest because it's charged on the outstanding balance, which is highest at the start of the loan.
Amortization Milestones on a $400,000 Loan
The table below illustrates how the principal-to-interest split shifts over the life of a 30-year, $400,000 loan at a 6.5% fixed rate. Notice how little equity builds in the first few years compared to the back half of the term.
| Year | Remaining Balance | Principal Paid to Date | Interest Paid to Date |
|---|---|---|---|
| 1 | $394,700 | $5,300 | $25,600 |
| 5 | $369,900 | $30,100 | $126,400 |
| 10 | $328,600 | $71,400 | $243,100 |
| 15 | $270,300 | $129,700 | $347,800 |
| 20 | $186,400 | $213,600 | $427,900 |
| 25 | $66,500 | $333,500 | $473,600 |
| 30 | $0 | $400,000 | $497,900 |
Interest Rate vs. Loan Term: The Real Tradeoff
Borrowers often focus only on the interest rate, but the loan term has just as much impact on lifetime cost. Shortening a term from 30 to 15 years usually shaves 0.4-0.75 percentage points off the rate at many lenders, but it also compresses repayment into half the time, which raises the required monthly payment substantially. On a $350,000 loan at a 6.5% 30-year rate versus a 5.9% 15-year rate, the 15-year option costs roughly $1,000 more per month but saves well over $150,000 in total interest.
Discount Points and Rate Buydowns
A discount point is an upfront fee equal to 1% of the loan amount, paid in exchange for a lower rate — typically a reduction of about 0.125% to 0.25% per point. Points make the most sense when you plan to keep the loan long enough to recoup the upfront cost through lower monthly payments, generally five years or more. Temporary buydowns (2-1 or 3-2-1 structures), often paid by the seller or builder, reduce the rate for the first one to three years before it steps up to the permanent note rate.
Loan Types and Typical 2026 Rate Ranges
The type of mortgage you choose affects your rate, down payment requirement, and mortgage insurance rules. Rates below are illustrative ranges for well-qualified borrowers and move with the broader rate environment, so always get a current quote from a lender.
- Conventional (conforming): Roughly 6.0%-7.0% for 30-year terms; requires as little as 3% down but PMI applies below 20% equity.
- FHA: Roughly 5.9%-6.9%; accepts credit scores as low as 580 with 3.5% down, but requires an upfront and annual mortgage insurance premium (MIP) that often lasts the life of the loan.
- VA: Roughly 5.7%-6.6% for eligible veterans and service members; no down payment required and no monthly mortgage insurance, though a one-time funding fee applies.
- USDA: Roughly 5.8%-6.7% for eligible rural and suburban properties; no down payment required for qualifying income levels, with a modest guarantee fee.
- Jumbo: Roughly 6.1%-7.1% for loan amounts above the conforming limit; typically requires stronger credit and larger reserves.
How Credit Score Tiers Affect Your Rate
Pricing adjustments based on credit score can shift your rate by more than a full percentage point between the top and bottom tiers, which translates into tens of thousands of dollars over the life of a loan.
| Credit Score Range | Typical Rate Impact | Approx. 30-Yr Rate* |
|---|---|---|
| 760+ | Best available pricing | 6.1%-6.4% |
| 700-759 | Small rate add-on | 6.3%-6.6% |
| 660-699 | Moderate rate add-on | 6.6%-7.0% |
| 620-659 | Higher rate add-on | 7.0%-7.5% |
| Below 620 | Conventional loans harder to get; FHA more common | 7.3%+ |
*Illustrative ranges only; actual pricing depends on the lender, loan program, down payment, and overall market rate environment.
Removing PMI and the Refinance Math
On a conventional loan, private mortgage insurance can generally be canceled once your loan balance drops to 80% of the home's original value, and lenders must automatically terminate it at 78%. Paying down principal faster or a rising home value (confirmed via a new appraisal) can help you reach that threshold sooner. Refinancing makes sense when the new rate is low enough that the monthly savings outweigh closing costs within a reasonable break-even period — commonly calculated by dividing total closing costs by the monthly payment reduction. If refinancing costs $6,000 and saves $150 per month, the break-even point is 40 months.
The Power of Extra Principal Payments
Because interest accrues on the remaining balance, even modest extra principal payments early in the loan can meaningfully shorten the term and cut total interest. Adding $200 per month to a $400,000, 6.5%, 30-year loan can retire the mortgage roughly 6-7 years early and save tens of thousands of dollars in interest. Making one extra full payment per year — a popular strategy achieved by paying biweekly instead of monthly — has a similar effect. Always confirm with your servicer that extra payments are applied to principal and that no prepayment penalty applies.