US Mortgage Calculator

What actually goes into a US monthly mortgage payment

In the US, most homebuyers talk about their mortgage as a single monthly number. Behind that one cheque are four or five moving parts, each of which changes on its own timetable.

Principal and interest

This is the loan itself. Every month a portion goes toward paying down what you borrowed and a portion goes to interest. Early in the loan, most of your payment is interest. Late in the loan, most of it is principal. The ratio shifts gradually, which is why a mortgage feels different 5 years in than 25 years in.

Property tax

Usually collected by the lender through an escrow account and paid to the county or city on your behalf. Rates vary hugely by state and municipality: Texas and New Jersey are famously high, several states have no personal property tax on homes at all. The number you type into this calculator should be the annual property tax in dollars, which your real-estate listing or county assessor's site will confirm.

Homeowner's insurance

Also escrowed in most cases. Required by the lender for any mortgaged property. Covers fire, storm, theft, and liability. Flood is usually separate.

HOA fees

If the property sits inside a homeowner's association, condo board, or co-op, expect a monthly fee covering shared maintenance, amenities, and reserves. HOA dues are not escrowed by the lender; you pay them directly to the association. Enter the monthly amount.

PMI

Private Mortgage Insurance. Required on conventional loans when your down payment is under 20% of the home price. It protects the lender, not you. Typically 0.5% to 1.5% of the loan amount per year, paid monthly. You can usually request it be removed once you have 20% equity in the home, either through paying down the loan or through the home's value rising.

How to stress-test the number

A useful habit: run the calculator three times. First with your expected rate, then with a rate one percent higher, then with a rate two percent higher. If the higher-rate monthly numbers would hurt, you are buying at the edge of your budget. Rates move. Property taxes rise. Insurance premiums climb after a bad storm season. The payment you can afford comfortably today is not necessarily the payment you will be making in three years, so leave yourself room.

A second useful habit: look at total interest, not just monthly payment. A 30-year loan at 6.5% on a $320,000 principal costs you about $408,000 in interest over the life of the loan. The same principal on a 15-year loan at the same rate costs about $182,000 in interest. The monthly payment is higher on the 15, but the lifetime cost is much lower. That is a real choice worth thinking about, not a footnote.

What this tool does not do

It does not quote you a rate. Lenders do that based on your credit score, down payment, income, debt ratio, and property details. It does not include closing costs (usually 2-5% of the home price, one-off). It does not assume any particular PMI rate; you enter your own expected monthly figure, which your lender or loan officer can give you. It is a back-of-envelope tool, useful for comparing scenarios, not a loan offer.

Nothing on this page is financial advice. For a real loan, talk to a loan officer or mortgage broker who knows your full picture.

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The monthly payment is one figure. These are the others worth running.

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