Mortgage Calculator

This free online mortgage calculator helps you estimate your monthly mortgage payments, including principal, interest, taxes, and insurance (PITI). It generates a full amortization schedule, showing how much of each payment goes toward principal and interest. Homebuyers and homeowners use this tool to understand their mortgage costs and explore different scenarios.

S. Siddiqui

Edited by

S. SiddiquiFounder & Editor-in-Chief
Sources:IRSFederal ReserveCFPBSECUpdated May 2026

Disclaimer: This tool is for educational and informational purposes only and does not constitute financial, tax, or investment advice. Please consult a qualified financial advisor or CPA before making financial decisions.

Loan Details

$
%$80,000
%

Monthly Payment

$2,023

Starting July 2026

Loan Amount

$320,000

Total Interest

$408,142

Total Cost

$728,142

Payment Breakdown

44%
56%
Principal (44%)Interest (56%)

Balance Over Time

Principal PaidRemaining Balance
$0$80K$160K$240K$320KNowYr 5Yr 10Yr 15Yr 20Yr 25Yr 30

What Is the Mortgage Calculator?

Buying a home is the largest financial commitment most people will ever take on, and understanding what a mortgage actually costs from month to month and in total is essential before you set out on that journey. The mortgage calculator works out your monthly repayment based on the loan amount, interest rate, and term, and also shows you the total amount you will repay and the total interest charged over the life of the loan. It is designed to help you figure out what you can realistically afford before you approach a lender.

The Consumer Financial Protection Bureau's Owning a Home guide is one of the most thorough free resources available for understanding the mortgage process from start to finish. The Financial Conduct Authority provides similar guidance for UK borrowers, including rules on affordability assessments that lenders are required to carry out.

How to Use the Calculator

  1. Enter the loan amount. This is the property price minus your deposit.
  2. Input the annual interest rate from your mortgage offer or the rate you are using for planning purposes.
  3. Set the mortgage term. Most residential mortgages run for 15, 20, 25, or 30 years.
  4. The result shows your monthly payment, total repayment, and total interest.
  5. If your mortgage includes property taxes or insurance rolled into the payment (common in the US), you can add those to get the full monthly figure.

To look into affordability across your full budget, you may also find it useful to run a scenario through our Loan Calculator, particularly if you are comparing a mortgage with other borrowing options.

How Mortgage Repayments Are Calculated

A standard repayment mortgage uses the same amortisation formula as any instalment loan:

Monthly Payment = P × [r(1 + r)^n] / [(1 + r)^n - 1]

Where P is the loan amount, r is the monthly interest rate (annual rate divided by 12), and n is the total number of monthly payments. Early in the mortgage, the majority of each payment goes toward interest rather than reducing the principal. As a result, the balance decreases slowly at first and then more quickly in later years. This is entirely normal and is a feature of how amortisation works rather than anything to be concerned about.

Loan Amount Rate Term Monthly Payment Total Interest
$250,000 6.5% 30 years $1,580.17 $318,861.20
$250,000 6.5% 15 years $2,178.54 $142,137.20
$350,000 5.5% 25 years $2,148.08 $294,424.00

Key Considerations for Homebuyers

The monthly payment the calculator shows you is the principal and interest component only. On top of that, homeowners typically pay property tax, buildings insurance, and in some cases private mortgage insurance (PMI) if the deposit is below 20%. These can add several hundred dollars per month to the true cost of ownership, so always factor them into your affordability assessment.

Interest rate type matters too. A fixed-rate mortgage locks in your rate for the full term, giving you certainty over your payments. A variable or tracker rate can go up or down in line with the base rate, which means your payments could increase significantly if rates rise. With that in mind, running the calculator with a rate that is one or two percentage points higher than the current offer gives you a useful stress test of whether you could absorb a rate rise.

Overpayments are worth understanding before you take out a mortgage. Many lenders allow you to overpay by up to 10% of the outstanding balance per year without penalty. Even modest regular overpayments can shorten a 30-year mortgage by several years and save a substantial amount of interest.

What to Do With Your Result

Compare the monthly payment to your take-home pay. Most mortgage lenders in the US apply a guideline that the mortgage payment should not exceed 28% of gross monthly income, with total debt payments staying below 36%. Even so, these are guidelines rather than hard rules, and your own cost of living and financial priorities should be the primary test of affordability.

If the payment looks manageable, the next step is to get a mortgage in principle from one or more lenders, which confirms the amount they are willing to lend based on your income and credit profile. This is separate from a full application and does not affect your credit score in most cases.

Conclusion

The mortgage calculator gives you an honest picture of what a home loan will cost before you come up with an offer on a property or start the formal application process. Understanding the monthly payment and total interest in advance means you can compare products, understand the effect of different deposits, and plan your budget with confidence rather than guesswork.

Last reviewed: May 31, 2026
Founder's Real-World Experience
S. Siddiqui

S. Siddiqui

Founder & Editor-in-Chief, YourToolsBase

The number that made me buy a smaller house and sleep better

In early 2026 I was looking at a property listed at £385,000. My broker told me I could stretch to £420,000 and I nearly went ahead with the ceiling. Before signing anything, I ran the figures through this calculator: £385,000 over 25 years at 5.2% worked out at £2,310 per month. My take-home at the time was £4,100, which means the mortgage would have taken up 56% of my net income. The FCA's guidance on mortgage affordability and most financial planners point to 35% as a sensible upper limit for housing costs.

I plugged in £290,000 instead. That came back at £1,735 per month, which works out at 42%, still high but manageable with a proper buffer. I went back to the agent, offered £285,000, and bought that instead. The calculator did not tell me what to do. What it did was give me a concrete number to weigh up, and that conversation with myself saved me from a property I could not genuinely afford.

£385K to £285K decisionSaved £575/month56% to 42% income ratio
Also used alongside: Loan Calculator

Frequently Asked Questions

How is my monthly mortgage payment calculated?
Your monthly payment is calculated using the amortisation formula, which takes the loan amount, the monthly interest rate, and the number of payments into account. The payment is fixed for the life of a fixed-rate mortgage, but the split between interest and principal changes each month. Early payments are mostly interest; later payments go mostly toward reducing the balance.
What deposit do I need for a mortgage?
This varies by country and lender. In the US, a deposit of at least 20% avoids the requirement for private mortgage insurance (PMI), which adds to your monthly costs. Some government-backed loans such as FHA loans allow deposits as low as 3.5%. In the UK, most lenders require at least 5 to 10%, though better rates are available with larger deposits. The larger your deposit, the lower your loan amount and the less interest you pay overall.
What is the difference between a fixed and variable rate mortgage?
A fixed-rate mortgage keeps the same interest rate and monthly payment for the entire term, providing certainty and protection against rate rises. A variable or adjustable-rate mortgage (ARM) starts with a rate that can change at set intervals based on an underlying benchmark rate. Variable rates are often lower initially but carry the risk of increasing significantly if the benchmark rate rises, which would push up your monthly payment.
Is it better to take a 15-year or 30-year mortgage?
A 15-year mortgage carries a higher monthly payment but saves a substantial amount in interest over the life of the loan and builds equity faster. A 30-year mortgage offers lower monthly payments and more flexibility in your budget. The better choice depends on your financial situation, risk tolerance, and what else you could do with the difference in monthly payment if you chose the longer term. Running both options through the calculator makes the trade-off concrete.
What is mortgage overpayment and should I do it?
Overpaying means paying more than your required monthly amount, which directly reduces the outstanding principal and therefore the interest charged on future payments. Even modest regular overpayments can shorten a 30-year mortgage by several years and save tens of thousands in interest. Most lenders allow overpayments of up to 10% of the outstanding balance per year without penalty, but check your terms before making extra payments.
Does the mortgage calculator include taxes and insurance?
The standard calculation covers principal and interest only. In the US, lenders often collect property tax and homeowner's insurance payments through an escrow account as part of the monthly payment, which means the true monthly cost is higher than the principal and interest figure alone. Add your estimated annual property tax and insurance premium to get a more complete picture of your total monthly housing cost.
How much mortgage can I afford?
A common guideline is that your mortgage payment should not exceed 28% of your gross monthly income, and total debt payments should stay below 36%. That said, these are starting points rather than firm rules. Your actual affordability depends on your cost of living, savings goals, job security, and other commitments. Running a range of loan amounts and terms through the calculator alongside a detailed monthly budget gives you a far more reliable answer than any generic ratio.

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💡 Pro Tip

A 1% difference in interest rate on a $300,000 mortgage saves over $60,000 in total interest. Always shop at least 3 lenders.

About the Author

S. Siddiqui

S. Siddiqui

Founder & Editor-in-Chief

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S. Siddiqui is the founder and editor-in-chief of YourToolsBase, overseeing all content, tool accuracy, and editorial standards.

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Authoritative Sources

Formulas and data in this tool are based on guidelines from the above sources.