Mortgage Calculator

Calculate your monthly mortgage payment based on home price, down payment, interest rate, and loan term in years. Use point as decimal separator.

Mortgage Parameters

Total purchase price of the property.
%
Amount or percentage paid upfront as down payment.
Total amount financed by the bank (Home price minus down payment).
%
Nominal annual interest rate agreed with the lender.
years
Duration of the mortgage loan (e.g. 15, 20, 25, or 30 years).

Mortgage Loan Summary

Estimated Monthly Payment
Loan Financing Amount
Total Payment
Total Interest

* Calculated amounts are estimates and do not include insurance or additional bank fees.

Total Payment Breakdown

Remaining Balance Schedule

Annual Amortization Schedule

Year
Principal Paid
Interest Paid
Remaining Balance

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What is a mortgage loan?

A mortgage is a long-term loan provided by a financial institution (bank) to purchase, construct, or renovate real estate. The acquired property serves as collateral for the debt.

The borrower agrees to repay the loan principal plus interest accrued over a set period through regular (usually monthly) installments.

How is a monthly mortgage payment calculated?

Most mortgages use the French amortization system, featuring constant monthly payments. In earlier installments, a higher portion goes toward interest, while toward the end of the term most pays down the principal.

French Amortization Formula

M = P · [ r(1 + r)n ] / [ (1 + r)n − 1 ]

Where:

  • M = Monthly payment.
  • P = Total mortgage loan amount (Home price − Down payment).
  • r = Monthly interest rate (Annual rate ÷ 12 / 100).
  • n = Total number of monthly payments (Loan years × 12).

Practical Mortgage Calculation Example

Suppose you want to buy a $200000 home with a 20% down payment ($40000). You request a $160000 mortgage at 4.5% annual interest for 20 years (240 months).

  • Loan amount (P): $160000
  • Monthly rate (r): 4.5% ÷ 12 = 0.375% monthly (0.00375 in decimal)
  • Total months (n): 20 years × 12 = 240 months

Applying the formula, the estimated monthly payment is $1012.63. Over 20 years, total payments equal $243031, of which $160000 is principal and $83031 is total interest.

Key Factors When Applying for a Mortgage

  • Down payment: Most lenders finance up to 80% of property value, making a 20% down payment recommended.
  • Fixed vs. variable rate: Fixed rates maintain identical payments throughout the loan term, while variable rates fluctuate based on market benchmarks.
  • Closing costs and insurance: In addition to monthly payments, consider property appraisal, title fees, taxes, and mandatory insurance.
  • Affordability: Monthly mortgage payments should ideally not exceed 30% to 35% of household net income.