Mortgage Calculator
Estimate your monthly mortgage payment from loan amount, rate, and term.
Use one currency throughout. Results are in the same currency as your inputs.
Estimated payment
— per month
How this mortgage calculator works
This tool estimates a fixed-rate mortgage payment using the standard amortization formula. You enter the loan principal (how much you borrow), the annual interest rate, and the term in years. The calculator converts the annual rate to a monthly rate, multiplies the term by 12 to get the number of payments, then solves for the payment that pays the loan off in full by the final month.
What the result includes
The monthly figure is principal and interest only. It does not add property taxes, homeowners insurance, private mortgage insurance (PMI), HOA dues, or closing costs. Lenders often quote a larger “PITI” payment that bundles some of those items. If you need a budget number closer to reality, add those costs separately after you have the P&I estimate.
Formula
With monthly rate r (annual rate ÷ 100 ÷ 12) and n payments (years × 12), payment = P × [r(1+r)n] ÷ [(1+r)n − 1]. If the rate is zero, payment is simply principal ÷ n.
Worked example (US-style dollars)
Suppose you borrow $250,000 at 6.5% for 30 years. The monthly rate is about 0.5417%. Plugging into the formula gives a payment near $1,580. That is the amount that, repeated every month for 360 months, retires the loan under those assumptions. Total paid over the life of the loan is payment × 360 — much more than the original principal because of interest.
Illustrative UK / Europe example (£)
Illustrative planning example only — not a mortgage offer, regulated advice, or a quote from a UK lender. UK repayment mortgages use the same capital-and-interest math as this fixed-rate model; product fees, term options, and stress tests differ by lender.
Suppose a repayment mortgage of £280,000 at 4.5% fixed for a 25-year term (300 monthly payments). Enter 280000, 4.5, and 25 in the fields above to see the estimated monthly capital-and-interest payment and lifetime total. Compare that with the same principal over 30 years to see how a longer term lowers the monthly figure while raising total interest.
| Term | What to compare in the tool | Planning takeaway |
|---|---|---|
| 25 years | Higher monthly P&I; fewer months of interest | Costs more per month; less interest over the life |
| 30 years | Lower monthly P&I; more months | Easier cash-flow; higher lifetime interest |
| Rate −0.5 pp | Re-run at 4.0% on the same term | Monthly savings × months you keep the deal ≈ value of the rate drop before fees |
UK readers: this tool estimates capital and interest only. Council tax, buildings insurance, and any product or arrangement fees are outside the formula — add them separately when budgeting, similar to how US PITI adds tax and insurance on top of P&I. See mortgage payment vs PITI for the housing-cost gap idea.
How to use it
- Enter the loan amount you expect to finance (home price minus down payment / deposit, or your remaining balance if refinancing).
- Enter the annual interest rate as a percent (for example, 4.5 for 4.5%).
- Enter the term in whole years (15, 20, 25, and 30 are common depending on market).
- Read the estimated monthly payment and lifetime total, then try alternate rates or terms to compare scenarios.
Decision checklist
- P&I vs full housing cost — Add tax, insurance, and fees outside this calculator before calling a number “affordable.”
- Term tradeoff — Shorter term raises the monthly payment and usually cuts lifetime interest; run both.
- Rate drop vs fees — Monthly savings × expected months in the deal should be compared with points, arrangement fees, or refinance costs.
- Deposit / down payment — Lower principal lowers P&I immediately; mortgage insurance / guarantee fees (where they apply) are not modeled here.
- Currency — The math is the same in £ or $; enter the principal in the currency of the loan and read the payment in that same currency.
Frequently asked questions
Why is my lender’s payment higher than this result?
This calculator shows principal and interest only. Taxes, insurance, PMI, and HOA dues (or UK equivalents such as buildings insurance and other housing costs) are usually added on a loan estimate. Read our guide on mortgage payment vs PITI for a clear breakdown.
Does a larger down payment / deposit change the formula?
Yes — indirectly. Enter a smaller loan amount (price minus deposit). The formula itself is the same; the principal changes.
Can I model extra monthly payments?
Not on this page. Extra principal shortens the payoff schedule. Use the debt payoff calculator for a simple balance-and-payment timeline, or ask your lender for a custom amortization with curtailments.
Does this model UK interest-only mortgages?
No. Interest-only products need a separate repayment vehicle for the capital. This page assumes capital-and-interest (repayment) amortization.
Scenario: rate vs term tradeoffs
Two common planning questions are better answered by comparing scenarios than by staring at one quote:
- Shorter term — A 15-year (or 25-year) loan usually has a higher monthly P&I than a 30-year loan at the same rate, but far less interest over the life of the loan. Run both terms with the same principal to see the monthly gap and the lifetime gap side by side.
- Smaller rate — A half-point rate drop on a large principal can save tens of pounds or dollars per month. Multiply that monthly savings by the months you expect to keep the loan before you pay points or refinance costs to buy the rate down.
- Larger deposit — Lower principal lowers P&I immediately and may also change insurance or fee eligibility, which this tool does not model.
For how advertised APR can differ from the rate you type here, see APR vs interest rate. Considering a refinance? Read refinance break-even before treating a lower payment as automatic savings. For how each payment splits between interest and principal over time, see loan amortization explained.
Compare the same loan over two terms
For 280,000 at 4.5%, these results use an unchanged rate for the entire term. A shorter initial fixed-rate deal does not guarantee that rate for the remaining years.
| Term | Monthly payment | Total interest |
|---|---|---|
| 25 years | 1,556.33 | 186,899.28 |
| 30 years | 1,418.72 | 230,738.79 |
The longer term saves about 137.61 each month but adds about 43,839.51 in interest. These differences exclude fees and future rate changes. Fractional-year inputs round up to the next complete monthly payment; terms above 100 years are not supported.
Background: CFPB explanation of principal, interest, and amortization. This source describes the payment structure; the examples above are calculated for this page.
Limitations
Real mortgages may have points, origination or arrangement fees, adjustable / tracker rates, or biweekly payment schedules. This page assumes a fixed rate and monthly compounding. Results are estimates only and are not financial advice or a lender quote.
Results are estimates only and are not financial advice.