Mortgage Calculator
Calculate your monthly mortgage payments including principal, interest, taxes, and insurance (PITI). View amortization schedule and analyze total costs.
Additional Costs
PITI Calculator
Calculate your total monthly payment including Principal, Interest, Taxes, and Insurance (PITI).
Down Payment & PMI
Calculate down payment amount and PMI (Private Mortgage Insurance) if down payment is less than 20%.
Property Taxes & Insurance
Include annual property taxes and homeowners insurance in your monthly payment calculation.
Understanding Mortgage Calculations
How Mortgage Payments Work
A typical mortgage payment consists of four components, commonly referred to as PITI: Principal, Interest, Taxes, and Insurance. The principal and interest form the base loan payment, while property taxes and homeowners insurance are often collected by the lender and held in escrow until they're due.
Fixed-Rate vs. Adjustable-Rate
This calculator assumes a fixed-rate mortgage where the interest rate remains constant throughout the loan term. With adjustable-rate mortgages (ARMs), the rate changes after an initial fixed period, affecting the monthly payment.
Fixed-rate mortgages provide payment stability and predictability, while adjustable-rate mortgages may offer lower initial rates but carry the risk of future payment increases.
Down Payment Considerations
- 20% down payment typically allows you to avoid PMI
- PMI protects the lender if you default on your loan
- PMI usually costs between 0.3% and 1.5% of your loan amount annually
- You can usually request to cancel PMI once you reach 20% equity
- FHA loans have their own mortgage insurance requirements
Amortization Explained
Amortization refers to the process of paying off your mortgage over time through regular payments. In the early years of your mortgage, a larger portion of each payment goes toward interest rather than principal. As time passes, this ratio shifts, with more of your payment going toward paying down the principal balance. The amortization schedule shows this breakdown for every payment over the life of your loan.
Refinancing Considerations
Refinancing your mortgage means replacing your current loan with a new one, typically to take advantage of lower interest rates, change your loan term, or tap into home equity. When considering refinancing, compare the interest savings against closing costs to determine if it makes financial sense. A general rule of thumb is that refinancing is worth considering if you can reduce your interest rate by at least 0.5% to 1%.