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Mortgage Calculator

Calculate your monthly mortgage payments including principal and interest, property taxes, homeowners insurance, HOA fees, and private mortgage insurance (PMI).

Last updated: July 2026

Property & Loan Details

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years

Taxes, Fees & Insurance

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$/mo

Total Monthly Payment

$2,499.16

Principal & Interest

$2,022.62

Total Loan Amount

$320,000.00

Monthly Payment Breakdown

Formula Breakdown

1. Base Payment (Principal + Interest)

P&I = LoanAmount × [r(1+r)^n] / [(1+r)^n - 1]

2. Monthly Tax & Insurance

Tax = (HomePrice × TaxRate) / 12

3. Monthly Private Mortgage Insurance (PMI)

Required if down payment is less than 20% of purchase price.

PMI = (LoanAmount × PMIRate) / 12

Understanding Mortgage Payments & Amortization

A mortgage is typically the largest financial commitment of a lifetime. Understanding how your monthly payment is divided between principal, interest, taxes, and insurance is essential to managing your long-term housing wealth.

Components of Your Monthly Payment (PITI)

A standard mortgage payment consists of four core elements: Principal (the portion that reduces your outstanding debt), Interest (the lender's fee for borrowing), Taxes (local municipal property taxes), and Insurance (homeowners hazard insurance plus Private Mortgage Insurance if down payment is below 20%). Homeowners association (HOA) fees may also apply.

Standard Amortization Formula

M = P * [r(1 + r)^n] / [(1 + r)^n - 1]

Where M is the monthly principal and interest payment, P is the principal loan amount, r is the monthly interest rate (annual nominal rate divided by 12), and n is the total number of monthly payments across the term.

Strategies to Save on Mortgage Interest

  • Accelerate Principal RepaymentPaying even an extra $100 per month directly toward principal reduces compounding interest and can shave years off your loan term.
  • Bi-Weekly PaymentsMaking half-payments every two weeks results in 26 half-payments (13 full monthly payments annually), cutting your payoff timeline significantly.
  • Cancel PMI EarlyOnce your loan-to-value ratio reaches 80% through principal paydown or home appreciation, request the cancellation of Private Mortgage Insurance.

Frequently Asked Questions

How is a mortgage payment calculated?

A standard monthly mortgage payment consists of Principal & Interest (P&I), property taxes, homeowners insurance, private mortgage insurance (PMI) if down payment is under 20%, and homeowner association (HOA) fees.

What is PMI and when do I pay it?

Private Mortgage Insurance (PMI) is a policy that protects the lender if you default. It is typically required on conventional loans if your down payment is less than 20% of the home purchase price.

What does PITI stand for?

PITI stands for Principal, Interest, Taxes, and Insurance. These are the four basic components that make up a homeowner's monthly housing payment. Together, they reflect the true cost of owning a home on a month-to-month basis.

Is a 15-year mortgage better than a 30-year mortgage?

A 15-year mortgage typically offers a lower interest rate and allows you to pay off your home twice as fast, saving you tens of thousands of dollars in interest. However, a 30-year mortgage has lower monthly payments, which provides greater cash flow flexibility and makes the home more affordable on a month-to-month basis.

How do extra payments affect my mortgage payoff schedule?

Any extra money you pay towards your mortgage is applied directly to the principal balance. This reduces the remaining loan balance and decreases the amount of interest that accumulates, helping you pay off your mortgage years ahead of schedule and saving you a substantial amount in interest fees.

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