Mortgage Calculator

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How to calculate your payments using a mortgage calculator

Here’s how to use our mortgage calculator to easily estimate payments:

Enter your home price. In the “Home price" field, input the price of the home you’re buying (or the current value of your home if you’re refinancing).
Enter your down payment. In the “Down payment" field, input the amount of your down payment (if you're buying) or the amount of equity you have (if you're refinancing). You can input either a dollar amount or a percentage.
Enter your loan term. In the “Loan term” field, enter the length of your loan — it's usually 30 years, but it could also be 20, 15 or 10.
Enter your interest rate. In the “Interest rate” field, input the rate you expect to pay or are currently paying. Our calculator defaults to the current average rate, but you can adjust this percentage.
Enter your ZIP code. In the “ZIP code” field, input the ZIP code for the home that you are purchasing or refinancing. This helps the calculator estimate local property taxes and insurance rates more accurately.
Click “Update.”

Bankrate's calculator also estimates property taxes, homeowners insurance and homeowners association fees. You can edit these amounts, or even edit them to zero, as you're shopping for a loan.

In addition, the calculator allows you to input extra payments (under the “Amortization” tab). This can help you decide whether to prepay your mortgage and by how much.

Typical costs included in a mortgage payment

Your mortgage payment is largely comprised of principal and interest, as well as taxes and insurance. These four costs are often referred to using the acronym PITI. Here's what that means for your loan:

Principal: This is the amount you borrowed from the lender, effectively your home's price minus the down payment.
Interest: This is what the lender charges you to borrow the principal, or loan amount. Interest rates are expressed as an annual percentage.
Property taxes: The tax on your home levied by your city or town, paid for as long as you own it. If your mortgage lender requires an escrow account, you'll pay a portion of your annual property tax bill with each monthly mortgage payment.
Homeowners insurance: Your insurance policy helps protect you financially from damage related to covered events. If you live in a flood zone or other disaster-prone area, you'll likely be required to have additional coverage. As with property taxes, you'll pay a portion of your annual insurance premium each month with your mortgage payment.
Mortgage insurance: If you’re getting a conventional or FHA loan and your down payment is less than 20 percent of the home's purchase price, you'll pay mortgage insurance premiums, which are also added to your monthly payment.

There are other costs associated with a home purchase to be familiar with as well:

Down payment: This is the portion of the home’s price you’re paying upfront, not financing with a mortgage. For many borrowers, this can be as little as 3 percent.
Closing costs: The many one-time fees associated with getting a mortgage. These can include the lender's origination fee, recording fees and fees for settlement and title services. Altogether, closing costs typically run 2 percent to 5 percent of the mortgage and are usually paid by or on the day the loan closes.

Mortgage payment formula

For the mathematically inclined, here's a formula to help you calculate mortgage payments manually:

M = P

r (1 + r)ⁿ

(1 + r)ⁿ - 1

Symbol
M	Total monthly mortgage payment
P	Principal loan amount
r	Monthly interest rate: Lenders provide you an annual rate so you’ll need to divide that figure by 12 (the number of months in a year) to get the monthly rate. If your interest rate is 5 percent, your monthly rate would be 0.004167 (0.05/12=0.004167).
n	Number of payments over the loan’s lifetime: Multiply the number of years in your loan term by 12 (the number of months in a year) to get the number of payments for your loan. For example, a 30-year fixed mortgage would have 360 payments (30x12=360).

This formula can help you crunch the numbers to see how much house you can afford. Alternatively, you can use this mortgage calculator to help determine your budget.

How a mortgage calculator can help you

Our mortgage calculator can help guide many of the decisions related to buying a home or refinancing your mortgage, such as:

Whether you're spending more than you can afford: Use the calculator to see how much you’ll pay each month, including in homeowners insurance premiums and property taxes. This can help you determine if you’re stretching your homebuying budget too far, or paying too much in terms of debt-to-income (DTI ratio).
Whether your budget allows for a shorter-term loan: Use the calculator to compare the monthly payments and total interest between a 10-, 15-, 20- or 30-year loan. Shorter-term loans come with lower interest rates, but higher monthly payments.
Whether you should put more or less money down: Use the calculator to weigh different down payment scenarios and how that’ll affect how much you’ll borrow and pay.
Whether you should pay off your mortgage early: Use the calculator to learn how extra payments can impact how quickly you’ll repay the loan and any interest savings.
When you can get rid of mortgage insurance: Use the calculator’s amortization schedule to determine when you’ll hit 20 percent equity — the magic number you need on a conventional loan to request that your lender remove private mortgage insurance (PMI).

How much house can you afford?

If you're not sure 28/36 rule, which dictates you spend no more than 28 percent of your gross income on housing costs and no more than 36 percent of your gross income on overall debt, including housing costs.

Say Joe makes $60,000 a year. That's a gross monthly income of $5,000 a month. Twenty-eight percent of that equals $1,400. If Joe were to abide by the 28/36 rule, he’d spend no more than $1,400 on a mortgage payment each month.

You can use our calculator to make similar estimations within the 28/36 rule.

Being conservative and cautious with a home purchase is advisable. The transaction needs to co-exist with our many other financial goals.
Mark Hamrick, Bankrate senior economic analyst

Meeting the 28/36 rule isn’t always doable or desirable, however.

“Being conservative and cautious with a home purchase is advisable,” says Mark Hamrick, Bankrate senior economic analyst. “Many prospective homeowners are tempted to stretch when buying a home, since it can literally be the culmination of a dream. At the same time, given that this is one of the most expensive and consequential purchases of a lifetime, the transaction needs to co-exist with our many other financial goals, including saving for retirement, saving for emergencies and paying down debt. If it turns out that income rises down the road, that presents an opportunity to sock money away to pay for repairs, maintenance and renovations later.”

How to lower your monthly mortgage payment

If the monthly payment you're seeing in our calculator looks a bit out of reach, you can try some tactics to reduce the hit. Play with a few of these variables:

Choose a longer loan. With a longer term, your payment will be lower (but you'll pay more interest over the life of the loan).
Spend less on the home. Borrowing less translates to a smaller monthly mortgage payment.
Shop for a lower interest rate. You don't have to get your mortgage from your bank. Comparing offers from a few lenders can help you uncover the lowest rates.
Make a bigger down payment. This is another way to reduce the size of the loan.

Learn more: How to lower your mortgage payment

Next steps to get a mortgage

A mortgage calculator is a springboard to help you estimate your monthly mortgage payment and understand what it includes. Once you have a good idea of your budget, you might move on to these next steps:

Get a mortgage prequalification or preapproval.
Shop for homes and make an offer.
Apply for a mortgage.

Additional mortgage resources

Compare mortgage rates for different loan types

Loan Type	Purchase Rates	Refinance Rates
30-Year Loan	30-Year Mortgage Rates	30-Year Refinance Rates
20-Year Loan	20-Year Mortgage Rates	20-Year Refinance Rates
15-Year Loan	15-Year Mortgage Rates	15-Year Refinance Rates
10-Year Loan	10-Year Mortgage Rates	10-Year Refinance Rates
FHA Loan	FHA Mortgage Rates	FHA Refinance Rates
VA Loan	VA Mortgage Rates	VA Refinance Rates
ARM Loan	ARM Mortgage Rates	ARM Refinance Rates
Jumbo Loan	Jumbo Mortgage Rates	Jumbo Refinance Rates
The table above links out to loan-specific content to help you learn more about rates by loan type.