Mortgage Calculator

Enter the amount you will borrow, not the price of the home. For a $400,000 home with 10% down, the loan amount is $360,000. Then enter the note rate from your Loan Estimate and the term in years.

The result is principal and interest only, calculated with the standard amortization formula: payment = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where r is the annual rate ÷ 12 and n is the number of months. For $360,000 at 6.75% over 30 years, that is $2,334.95 a month, with $480,583.13 of interest over the life of the loan. The result card labels this figure "Monthly EMI", which is simply another name for the same level monthly payment.

If you enter a 0% rate, the calculator divides the loan evenly by the number of months, so $360,000 over 30 years shows $1,000.

Most lenders collect more than principal and interest each month. Add the other pieces yourself:

With the example figures, the payment rises to $2,884.95 before any PMI. The tax and insurance numbers are placeholders: use your own.

PMI matters at this down payment. Lenders generally require it on conventional loans when you put down less than 20%. On a principal residence, the Homeowners Protection Act lets you ask in writing to cancel it once the balance is scheduled to reach 80% of the home's original value, provided you have a good payment history and meet the other conditions. It ends automatically when the balance is scheduled to reach 78%, if you are current on payments. FHA and VA loans follow different rules.

Run each quote separately with the same loan amount and term. On $360,000 over 30 years:

• 6.75% gives $2,334.95 a month and $480,583.13 of total interest.
• 6.5% gives $2,275.44 a month and $459,160.16 of total interest.

A quarter point saves $59.51 a month and about $21,423 over 30 years. That is the full-term figure, though. If you sell or refinance after 7 years, you only collect 7 years of savings.

When a lender offers the lower rate in exchange for an upfront fee (discount points), divide the fee by the monthly saving to find the break-even. A $3,600 fee ÷ $59.51 is about 60 months. If you expect to keep the loan longer than about 5 years, the fee pays for itself; if not, it doesn't.

This calculator assumes you pay exactly the scheduled amount until the end of the term. To see what an extra $200 a month does, use the loan payoff calculator with the balance, rate and a $2,535 payment. It shows the $360,000 loan paid off in 23 years 10 months instead of 30 years, with roughly $115,000 less interest. Before you plan on it, check that your loan has no prepayment penalty and that your servicer applies extra money to principal.

For an adjustable-rate mortgage, enter the starting rate to see the initial payment, then rerun it for the reset. After 5 years on the example loan you would still owe about $337,953. If the rate then adjusted to 7.5% for the remaining 25 years, entering those figures gives $2,497.44 a month, about $162 more than before.