Finance & Tax · Updated 2026

Mortgage Calculator

Calculate your exact monthly payment, total interest paid, and full amortization schedule. Includes property tax, insurance and HOA. Updated with 2026 mortgage rates.

Full PITI Payment
Amortization Schedule
2026 Rate Reference
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Mortgage Calculator
Monthly Payment · Amortization · 2026
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Enter your mortgage details to see your payment breakdown.

Current Mortgage Rates — 2026

30yr Fixed~6.75%
20yr Fixed~6.50%
15yr Fixed~6.15%
5/1 ARM~6.40%
FHA 30yr~6.50%
Indicative averages for 2026. Your actual rate depends on credit score, LTV, and lender. Always compare at least 3 lenders.
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How Your Mortgage Payment Is Calculated

Your monthly mortgage payment has four components: Principal, Interest, Taxes, and Insurance, known as PITI. The principal and interest portion is calculated using the standard amortization formula, which ensures the loan is fully paid off at the end of the term through equal monthly payments.

In the early years of a mortgage, the majority of each payment goes toward interest. Over time, as the principal balance decreases, more of each payment is applied to principal. This is why extra payments early in the loan have the greatest impact on total interest paid.

The formula for monthly payment is: M = P x [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 number of total payments. On a $320,000 loan at 6.8% over 30 years, this produces a P&I payment of approximately $2,093 per month.

Understanding Your Payment Breakdown

Principal & Interest (P&I)
The core loan payment, fixed for the life of a fixed-rate mortgage. Early payments are mostly interest. By year 20 of a 30-year loan, the split reverses in favor of principal.
Total Interest Cost
On a $320,000 loan at 6.8% over 30 years, total interest exceeds $420,000, more than the original loan. A 15-year term or extra monthly payments dramatically change this number.
Down Payment Impact
Every extra dollar down reduces your loan and monthly payment. Reaching 20% also eliminates PMI, saving $100 to $300 per month on most loans during the early years.
15 vs 30 Year Tradeoff
The 15-year saves tens of thousands in interest but requires approximately 40% higher monthly payments. Many choose 30-year for flexibility and make extra principal payments when possible.

What Affects Your Interest Rate in 2026

Your credit score is the single biggest factor lenders consider. Scores above 760 receive the best available rates. Below 680, rates are typically 0.5 to 1.5% higher, adding tens of thousands in total interest on a standard loan. Other key factors include your loan-to-value ratio (LTV), loan size, property type, and whether you choose a fixed or adjustable rate.

As of 2026, 30-year fixed rates are averaging in the 6.5 to 7% range, having stabilized after the rapid increases of 2022 to 2023. Shopping at least 3 lenders before committing can save thousands. Even a 0.25% rate difference on a $350,000 loan translates to over $18,000 in total interest over 30 years.

The True Cost of a Mortgage

Most buyers focus on the monthly payment, but the total cost picture is what matters most for long-term financial planning. A $400,000 home purchased with 20% down at 6.8% over 30 years will cost approximately $660,000 in principal and interest alone, before property taxes, insurance, and maintenance. Understanding the full cost helps you make better decisions about loan term, down payment size, and how aggressively to pay down the principal.

Estimates only. Your actual payment may vary based on exact rate, local taxes, PMI, and lender fees. Consult a licensed mortgage professional before making financial decisions.
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Mortgage Questions
How is a monthly mortgage payment calculated step by step?+
The principal and interest payment uses the amortization formula: M = P x [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 total payments. For a $320,000 loan at 6.8% over 30 years: r = 0.00567, n = 360, giving approximately $2,093/month P&I. Property tax, insurance, HOA, and any PMI are then added for your total PITI payment.
How much house can I afford based on my salary?+
The standard guideline is the 28/36 rule: spend no more than 28% of gross monthly income on your total housing payment, and no more than 36% on all debt combined. On a $90,000 salary ($7,500/month), the 28% rule suggests a maximum payment of $2,100/month, supporting roughly a $310,000 loan at 6.8% over 30 years. Lenders also require total DTI below 43% for most conventional loans.
What is the difference between a 15-year and 30-year mortgage?+
On a $300,000 loan at 6.8%, the 30-year costs approximately $1,961/month P&I and generates $406,000 in total interest. The 15-year costs approximately $2,660/month but total interest is only $178,800, a saving of $227,000. The 15-year also typically carries a rate 0.5 to 0.75% lower. The tradeoff is cash flow: the higher 15-year payment is locked in. A smart middle ground is taking the 30-year and making extra principal payments when possible.
How much down payment do I need to buy a house?+
By loan type: Conventional loans require as little as 3% with PMI, and 20% eliminates PMI entirely. FHA loans require 3.5% with a 580+ credit score. VA loans for eligible veterans and USDA loans for rural areas allow 0% down with no PMI. Many states also offer first-time homebuyer grants of $5,000 to $25,000. Budget an additional 2 to 5% of purchase price for closing costs on top of your down payment.
What is PMI and how do I avoid or remove it?+
Private Mortgage Insurance (PMI) is required on conventional loans when your down payment is under 20%. It typically costs 0.5 to 1.5% of the loan annually, which is $1,500 to $4,500/year on a $300,000 loan. To avoid it: put 20% or more down or use a piggyback loan (80/10/10). To remove existing PMI: request cancellation when your balance reaches 80% of the original value, or get a new appraisal if your home has appreciated. Lenders must automatically cancel PMI at 78% LTV under federal law.
What credit score do I need for a mortgage?+
By loan type: Conventional loans typically require 620, with 740+ for the best rates. FHA accepts 580 with 3.5% down. VA has no official minimum but most lenders require 620. The rate difference between a 620 and 760 score on a $320,000 30-year mortgage can be 1.25 to 1.5%, translating to $260+ more per month and over $93,000 extra in total interest. Check your credit reports at annualcreditreport.com before applying.
Does paying extra principal each month make a big difference?+
Dramatically. On a $320,000 mortgage at 6.8% over 30 years: adding $100/month extra saves approximately $38,000 in interest and cuts the term by over 3 years. Adding $300/month extra saves approximately $93,000 and eliminates 8 years. Extra payments reduce the principal on which future interest is calculated. Always instruct your servicer to apply extra payments to principal, not future installments.
When does refinancing a mortgage make financial sense?+
Refinancing makes sense when your break-even period is reasonable. Divide total closing costs by monthly payment savings: if costs are $7,000 and you save $220/month, break-even is 32 months. If you plan to stay beyond that, refinance. Generally a rate reduction of 0.75% or more justifies it on loans above $200,000. Also refinance to eliminate PMI if home value has risen, to switch from ARM to fixed, or to shorten the term if income has grown.
What closing costs should I expect when buying a home?+
Closing costs typically run 2 to 5% of the loan amount. Common items: loan origination fee 0.5 to 1%, appraisal $400 to $700, title insurance $500 to $1,500, title search $200 to $400, recording fees $50 to $250, attorney fees where required $500 to $1,500, prepaid property taxes 1 to 3 months, prepaid insurance first year, and prepaid interest. On a $350,000 loan, budget $7,000 to $17,500. Sellers sometimes cover part of closing costs as a negotiating concession.
Is it better to rent or buy a home right now?+
The decision depends on how long you plan to stay and your local market. A useful rule is the price-to-rent ratio (home price divided by annual rent). Below 15 favors buying; above 20 typically favors renting short-term. With mortgage rates around 6.8% in 2026 and elevated prices in many markets, renting is financially advantageous in major cities if you plan to stay fewer than 5 to 7 years. Buying makes more sense with a 7+ year horizon, stable income, and a market with strong appreciation prospects.
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