Interactive real estate analysis
Mortgage and Amortization Calculator
Estimate payments, amortization and the effect of extra payments.
What the monthly payment measures
A mortgage payment repays borrowed principal and pays interest. The headline principal-and-interest amount is only part of the monthly budget. Property taxes, insurance, mortgage insurance and association charges can materially change affordability.
How to Use This Calculator
- Enter the amount actually borrowed, the annual note rate and the loan term.
- Add taxes, insurance, association dues and mortgage insurance where applicable.
- Compare the amortization schedule and test extra principal payments.
Run Your Numbers
Enter your assumptions below. The calculator provides educational estimates; confirm inputs for your property and financing.
If the calculator does not load, open the calculator in a new tab.
Understand the numbers
Formulas and Assumptions
This guide explains the core calculation methods. The widget’s detailed assumptions and schedules govern its displayed results.
- Monthly principal and interest = P × r × (1 + r)^n ÷ ((1 + r)^n − 1)
- Monthly interest = opening balance × r
- Principal repaid = payment − interest
- Total monthly housing cost = principal and interest + taxes/12 + insurance/12 + PMI + HOA
How to Interpret the Results
P is loan principal; r is the annual interest rate as a decimal divided by 12; n is the number of monthly payments. At a zero interest rate, payment = P/n. Extra principal reduces the balance used for future interest.
Use consistent time periods and enter percentages in the format requested by each field. Test conservative assumptions as well as your expected case. Estimates are not a lending commitment or individualized financial, legal or tax advice.
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Detailed Methodology and Model Assumptions
Amortization and Extra Principal
Interest for a month is opening balance × monthly rate. Principal reduction is the scheduled payment minus that interest, plus any extra principal. The next balance is the old balance minus principal reduction. Repeat until the balance reaches zero, limiting the final payment to the amount owed.
With no prepayments, total interest = monthly principal-and-interest payment × number of payments − original principal. With extra payments, sum the actual monthly interest instead. The first years contain more interest because more principal remains outstanding.
Payment Assumptions
The model holds tax, insurance and association assumptions constant. Real escrow payments can rise. PMI is estimated from the original loan and annual premium; the modeled cancellation point follows the scheduled balance rather than a new appraisal.
Compare shorter terms, larger down payments and extra principal separately. Keep enough liquidity for repairs and emergencies before committing every spare dollar to prepayment.
Worked Example
Hypothetical illustration: these figures are separate from the live calculator inputs.
A $200,000 loan at 6% for 30 years has a principal-and-interest payment of approximately $1,199.10 per month. Adding $300 in taxes and $100 in insurance makes the estimated monthly housing payment $1,599.10 before any mortgage insurance or association fees.
What makes a payment affordable?
Compare the complete housing bill with your income, existing debts and emergency reserves. A lender’s qualifying limit is not automatically a comfortable household budget.
Rules of Thumb, and Their Limits
A longer term reduces the required payment but can increase total interest. Extra payments help only when applied to principal; check loan terms for restrictions.
Frequently Asked Questions
Does the payment include property taxes?
Principal and interest alone do not. Include taxes and insurance in the appropriate fields to estimate the broader monthly cost.
Does the first payment pay much principal?
On a standard amortizing loan, early payments contain more interest because the outstanding balance is larger.
Massachusetts and Property-Specific Considerations
Use the municipality’s actual assessed taxes and the property’s current insurance and association costs. Local rent evidence, building condition and the transaction’s legal use matter more than a statewide average. Review current lender or tax requirements where applicable.
Explore Massachusetts investment guides · Use the due diligence checklists · Compare other calculators
Compare Loan Terms
| Term | Monthly P&I | Total scheduled interest |
|---|---|---|
| 15 years | $1,687.71 | $103,788 |
| 20 years | $1,432.86 | $143,887 |
| 30 years | $1,199.10 | $231,676 |
All scenarios borrow $200,000 at 6%, without fees or extra principal. A shorter term repays equity faster but requires a higher monthly commitment. Real loan quotes may use different rates for different terms.
Use the Comparison in Your Decision
Change one assumption at a time in the calculator, record the result and compare it with your base case. Then combine adverse assumptions to see whether the plan still fits your cash reserves and objectives. A useful scenario explains what must remain true for the transaction to work.