How to Use the Mortgage Calculator
Enter your home price, down payment, interest rate, and loan term. The calculator instantly shows your monthly payment, total interest paid, and a year-by-year amortization schedule. In 2025, the average 30-year fixed mortgage rate in the United States is around 6.5–7.5%. A $350,000 home with 20% down ($70,000) at 6.9% for 30 years results in a monthly payment of approximately $1,848.
Mortgage Payment Formula
The monthly mortgage payment uses the standard amortization formula: M = P × [r(1+r)ⁿ] / [(1+r)ⁿ − 1] where P is the loan principal (home price minus down payment), r is the monthly interest rate (annual rate ÷ 12 ÷ 100), and n is the total number of monthly payments (years × 12). This formula applies to conventional fixed-rate mortgages — adjustable-rate mortgages (ARMs) will have different payments after the fixed period ends.
Frequently Asked Questions
In 2025, a competitive 30-year fixed mortgage rate in the USA is typically between 6.0%–7.5% depending on your credit score, loan size, down payment, and lender. Rates above 750 credit score can get the lowest tiers. Check current rates from multiple lenders before committing — a 0.5% difference on a $300,000 loan saves over $30,000 in total interest over 30 years.
A widely used rule is that your mortgage payment should not exceed 28% of your gross monthly income (front-end ratio), and total debt payments should not exceed 36–43% (back-end ratio). For example, if you earn $8,000/month, your max mortgage payment would be around $2,240. Factor in property taxes, homeowners insurance, and HOA fees — these are not included in this calculator's output.
A 15-year mortgage has higher monthly payments but you pay far less total interest and build equity faster. A 30-year mortgage has lower monthly payments, giving you more cash flow, but you pay roughly 2–3× more in total interest over the life of the loan. Use this calculator to compare both terms — enter the same loan amount and see the difference in total interest paid.
No — this calculator shows principal and interest (P&I) only. Your actual monthly payment to the lender will typically include an escrow component for property taxes (0.5–2.5% of home value/year) and homeowners insurance (average $1,200–$2,400/year in the US). PMI (private mortgage insurance) is also required if your down payment is below 20%, typically adding 0.5–1.5% of the loan amount annually.