Mortgage Calculator

A home loan payment depends on the price, the deposit, the rate and the term, and then lenders add property tax, insurance and fees on top. This calculator puts them together into one monthly figure and shows the total interest over the life of the loan. If you add an extra monthly payment, it shows how many years sooner you'd finish and how much interest you'd save.

How to use it

1. Enter the home price and your down payment.
2. Add the interest rate and the loan term in years.
3. Fill in property tax, insurance and any monthly fees that apply to you.
4. Read the monthly payment, then try an extra payment to see the effect.

When it helps

• Working out what you can afford before you start viewing homes.
• Comparing a 15-year loan against a 30-year one.
• Seeing how a bigger deposit changes the monthly cost.
• Judging whether extra payments are worth it.

Good to know

• To compare rates fairly, change only the rate and keep everything else fixed.
• Extra payments in the first years save the most interest, because the balance is highest then.
• Your lender's official quote may include other costs, so treat this as an estimate.

How the payment is calculated

The monthly payment on a standard repayment loan is fixed by a formula using the loan amount, monthly interest rate and number of payments. Early payments are mostly interest and later ones mostly principal, because interest is charged on the remaining balance each month.

On a 280,000 loan at 6.5 percent over 30 years, the payment is about 1,770 a month, and total interest comes to about 357,000, more than the loan itself.

Worked example: extra payments

Add 200 a month to that loan and it's repaid in about 22 years and 10 months instead of 30, saving just over 101,000 in interest. The saving is so large because extra payments reduce the balance on which interest is charged for the rest of the loan.

Check your loan terms first, since some lenders charge fees for early repayment.

Costs beyond the loan

Owning a home costs more than the mortgage payment. Add property tax, insurance, maintenance, which many experts estimate at around 1 percent of the home's value per year, utilities and any association fees. A deposit under 20 percent may also require mortgage insurance.

Include those in your budget, and keep a reserve for repairs. A payment you can afford only when nothing goes wrong is too tight.

Fixed or variable rates

A fixed rate keeps your payment constant for a set period, which makes budgeting easy. A variable rate may start lower but can rise. When rates are changing, compare by running the calculator at a higher rate to see whether you could cope.

This calculator assumes one rate for the whole term. If your loan has a fixed period followed by a different rate, run two calculations.

Questions