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Current Mortgage Rates: 2026
How Your Mortgage Payment Is Calculated
A 30-year fixed mortgage of $320,000 at 6.8% costs $2,086 a month in principal and interest. Property tax, homeowners insurance, PMI and HOA dues come on top, and together they often add $400 to $900 a month. Enter your price, down payment, rate and term above to see your full monthly payment and the amortization schedule.
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 about $2,086 per month.
Understanding Your Payment Breakdown
Principal & Interest (P&I)
Total Interest Cost
Down Payment Impact
15 vs 30 Year Tradeoff
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.
In September 2026 the 30-year fixed averaged between 6.7% and 7% in Freddie Mac's weekly survey. 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 about $751,000 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.
Monthly Payment by Loan Amount and Rate
Principal and interest only, 30-year fixed. Taxes and insurance are extra.
| Loan amount | 6.0% | 6.5% | 7.0% | 7.5% |
|---|---|---|---|---|
| $200,000 | $1,199 | $1,264 | $1,331 | $1,398 |
| $300,000 | $1,799 | $1,896 | $1,996 | $2,098 |
| $400,000 | $2,398 | $2,528 | $2,661 | $2,797 |
| $500,000 | $2,998 | $3,160 | $3,327 | $3,496 |
| $600,000 | $3,597 | $3,792 | $3,992 | $4,195 |
| $750,000 | $4,497 | $4,741 | $4,990 | $5,244 |
Each half point of rate moves the payment on a $400,000 loan by roughly $130 a month, or about $47,000 over 30 years.
15-Year vs 30-Year on the Same Loan
$320,000 borrowed at 6.8% for both terms. In practice 15-year rates are usually a little lower, which widens the gap in total interest further.
| $320,000 at 6.8% | 30-year | 15-year |
|---|---|---|
| Monthly P&I | $2,086 | $2,841 |
| Total interest | $431,018 | $191,306 |
| Total paid | $751,018 | $511,306 |
What Extra Payments Actually Save
Same $320,000 loan at 6.8% over 30 years, with a fixed extra amount added to principal every month from the start.
| Extra per month | Paid off in | Total interest | Interest saved |
|---|---|---|---|
| $0 | 30.0 years | $431,018 | $0 |
| $100 | 26.2 years | $364,317 | $66,701 |
| $250 | 22.1 years | $298,911 | $132,107 |
| $500 | 17.8 years | $232,813 | $198,205 |
| $1,000 | 13.1 years | $163,727 | $267,291 |
Check your loan terms before prepaying. Most conventional loans made since 2014 have no prepayment penalty, but ask the servicer to apply the extra amount to principal, not to next month's payment.
PMI, Loan Limits and Other 2026 Numbers
When PMI goes away
On a conventional loan you can ask the lender to cancel private mortgage insurance once the balance reaches 80% of the original home value, and it must end automatically at 78% under the Homeowners Protection Act, as long as payments are current. FHA mortgage insurance works differently: with less than 10% down it stays for the life of the loan unless you refinance.
Conforming loan limit
For 2026 the baseline conforming loan limit is $832,750 for a one-unit home, and up to $1,249,125 in high-cost areas. Borrowing more than your county's limit means a jumbo loan, which usually needs a larger down payment and stronger credit.
Rates right now
The 30-year fixed averaged 6.95% on 17 September 2026 in Freddie Mac's weekly survey, up from 6.26% a year earlier. Your own quote depends on credit score, down payment and points, so compare at least three lenders on the same day.
Already have a mortgage and wondering whether a new rate is worth the fees? The mortgage refinance calculator works out the break-even month.