Bankrate Mortgage Calculator
Calculate your monthly mortgage payment with principal, interest, taxes, insurance, PMI, and HOA fees. See your full amortization schedule, compare loan terms, and understand the true cost of your home loan.
How Mortgage Payments Work
A mortgage payment typically consists of four components, often referred to as PITI: Principal, Interest, Taxes, and Insurance. This calculator helps you estimate your total monthly payment including all of these costs, plus PMI and HOA fees if applicable.
Monthly Payment Formula:
M = P × [ r(1 + r)n ] / [ (1 + r)n − 1 ]
Where:
M = Monthly principal & interest payment
P = Principal (Loan amount after down payment)
r = Monthly interest rate (Annual rate ÷ 12)
n = Total number of payments (Term in years × 12)
Total Monthly Payment = P&I + Property Tax + Home Insurance + PMI + HOA Fees
Private Mortgage Insurance (PMI) is typically required when your down payment is less than 20% of the home price. PMI protects the lender if you default on your loan. The average PMI rate ranges from 0.46% to 1.50% of the loan amount annually.
Tips for Getting the Best Mortgage
- Improve Your Credit Score: A higher credit score qualifies you for lower interest rates. Even a 0.5% rate difference can save you tens of thousands over the life of the loan.
- Make a Larger Down Payment: A 20% down payment eliminates PMI and lowers your monthly payment. Every $10,000 extra down saves you about $60-80 per month in payments.
- Choose the Right Loan Term: A 15-year mortgage has higher payments but saves significant interest compared to a 30-year loan. Compare both options to see which fits your budget.
- Shop Around: Compare rates from multiple lenders. Even small rate differences can add up to thousands of dollars in savings.
- Consider Extra Payments: Even $100 extra per month can shave years off your mortgage and save thousands in interest.
❓ Mortgage Calculator FAQ
What is included in a mortgage payment?
A mortgage payment typically includes principal, interest, property taxes, and homeowners insurance (PITI). This calculator also includes PMI and HOA fees if applicable.
What is PMI and when do I have to pay it?
Private Mortgage Insurance (PMI) is required when your down payment is less than 20% of the home price. PMI protects the lender if you default. Once you reach 20% equity, you can request to cancel PMI.
What is the difference between interest rate and APR?
The interest rate is the cost of borrowing the principal. APR (Annual Percentage Rate) includes the interest rate plus fees and other costs, giving you the true cost of the loan. APR is typically higher than the interest rate.
How much house can I afford?
Most lenders recommend that your total monthly housing payment (PITI) should not exceed 28% of your gross monthly income, and your total debt payments should not exceed 36%. Use this calculator to see what monthly payment fits your budget.
What is a good credit score for a mortgage?
• 740+ (Excellent): Best rates
• 700-739 (Good): Competitive rates
• 660-699 (Fair): Higher rates
• Below 660: May struggle to qualify or pay higher rates
Should I choose a 15-year or 30-year mortgage?
A 15-year mortgage has higher monthly payments but significantly lower total interest. A 30-year mortgage has lower monthly payments but costs more in interest over time. Choose based on your budget and financial goals.
What is an amortization schedule?
An amortization schedule shows each payment's breakdown between principal and interest over the life of the loan. Early payments are mostly interest; later payments are mostly principal. This calculator can display the full schedule.
How can I pay off my mortgage faster?
Make extra principal payments each month, make bi-weekly payments instead of monthly, or make one extra payment per year. Even small extra payments can save thousands in interest and shave years off your mortgage.
What are property taxes and how are they calculated?
Property taxes are annual taxes based on your home's assessed value, used to fund local services like schools and infrastructure. Rates vary by location. Our calculator uses the annual amount you enter.
What is homeowners insurance and do I need it?
Homeowners insurance protects your home and belongings against damage from fire, theft, and natural disasters. Lenders typically require you to carry a policy before closing on a mortgage.
What are HOA fees?
Homeowners Association (HOA) fees are monthly dues paid by residents in planned communities or condos. These fees cover common area maintenance, amenities, and sometimes utilities. Not all homes have HOA fees.
How does the down payment affect my mortgage payment?
A larger down payment reduces your loan amount, which lowers your monthly payment and total interest. It also helps you avoid PMI if you put down 20% or more.
What is the difference between fixed-rate and adjustable-rate mortgages?
A fixed-rate mortgage has the same interest rate for the entire loan term, providing predictable payments. An adjustable-rate mortgage (ARM) has a rate that can change periodically, usually starting lower but with the risk of increasing over time.
How do I calculate my monthly mortgage payment?
Use the formula: M = P × [r(1+r)^n] / [(1+r)^n − 1], where P is the principal, r is the monthly interest rate, and n is the number of payments. Or simply use this calculator to get your payment instantly.
What is loan principal?
The loan principal is the amount you borrow to purchase your home, calculated as the home price minus your down payment. This is the amount you pay interest on over the life of the loan.
Can I use this calculator for mortgage refinancing?
Yes! Enter your current home value as the "Home Price" and your remaining balance as the "Down Payment" (or adjust the loan amount accordingly). This will show you what your new payment would be with a refinanced loan.
What is the total cost of a mortgage?
The total cost of a mortgage is the sum of all your monthly payments over the life of the loan, including principal, interest, taxes, insurance, PMI, and HOA fees. This calculator shows you the total interest and total cost.
How do I get the best mortgage rate?
Improve your credit score, save for a larger down payment, compare rates from multiple lenders, consider a shorter loan term, and lock in your rate when rates are favorable. Even a small rate difference can save you thousands.