How this calculator works
The principal-and-interest payment uses the standard amortization formula. Property tax and insurance are spread over 12 months, PMI is charged while the down payment is under 20%, and HOA dues are added as entered.
Under the federal Homeowners Protection Act, you can ask your lender to cancel PMI once your balance reaches 80% of the home’s original value, and it must end automatically when the scheduled balance reaches 78%. Extra principal payments reach the 80% point sooner. The APR spreads points and lender fees over the life of the loan, so it is higher than the note rate whenever you pay them.
Assumptions and tips
- Fixed-rate loan; taxes, insurance and HOA stay the same.
- APR here counts discount points and lender fees. Official APR disclosures can include other finance charges, such as mortgage insurance, so your Loan Estimate may differ slightly.
Worked example
Using the default values in the calculator above:
| Input | Value |
|---|---|
| Home price | $400,000 |
| Down payment | 10 % |
| Interest rate | 6.5 % |
| Loan term | 30 years |
| Property tax rate | 1.1 %/yr |
| Homeowners insurance | 1,800 $/yr |
| HOA dues | 0 $/mo |
| PMI rate (if down payment < 20%) | 0.6 %/yr |
| Extra principal each month | $0 |
| Discount points | 0 % of loan |
| Lender fees | $0 |
| Result | Value |
|---|---|
| Total monthly payment | $2,972.11 |
| Principal & interest | $2,275.44 |
| Property tax | $366.67/mo |
| Homeowners insurance | $150/mo |
| PMI | $180/mo |
| HOA | $0/mo |
| Loan amount | $360,000 |
| Down payment | $40,000 |
| Total interest | $459,160 |
| Paid off in | 30 yr 0 mo |
| APR | 6.5 % |
| PMI can be cancelled on request after (80% LTV) | 7 yr 11 mo |
| PMI ends automatically after (78% LTV) | 9 yr 1 mo |
| PMI paid until cancellation | $17,100 |
Step by step:
- Loan = $400,000 × (1 − 10%) = $360,000
- Monthly rate = 6.5% ÷ 12 = 0.5417%; payments = 360
- P&I = 360,000 × 0.005417 ÷ (1 − (1 + 0.005417)^−360) = $2,275.44
- Tax = $400,000 × 1.1% ÷ 12 = $366.67; insurance = $1,800 ÷ 12 = $150
- PMI = $360,000 × 0.6% ÷ 12 = $180 until the balance reaches $320,000 (80% of the price)
Monthly principal and interest per $100,000 borrowed
Calculated with this tool for a $100,000 loan (price $125,000, 20% down) — multiply by your loan size in hundred-thousands.
| Rate and term | Principal & interest | Total interest |
|---|---|---|
| 5% · 30 years | $536.82 | $93,256 |
| 6% · 30 years | $599.55 | $115,838 |
| 6.5% · 30 years | $632.07 | $127,544 |
| 7% · 30 years | $665.3 | $139,509 |
| 7.5% · 30 years | $699.21 | $151,717 |
| 6% · 15 years | $843.86 | $51,894 |
| 6.5% · 15 years | $871.11 | $56,799 |
| 7% · 15 years | $898.83 | $61,789 |
Common mistakes to avoid
- Comparing loans by monthly payment alone — a lower payment over 30 years can cost far more interest than a 15-year loan.
- Forgetting property tax and insurance, which can add 25–40% to the principal-and-interest payment.
- Assuming PMI stops at 20% equity automatically — you usually have to ask at 80%; it ends on its own at 78%.
Frequently asked questions
How much house can I afford?
Many lenders look for total housing costs under about 28% of gross monthly income and all debts under about 36–43%. Enter a price and down payment here to see the monthly cost, then compare it with your budget.
When does PMI go away?
You can request cancellation when your balance reaches 80% of the original home value; it must end automatically at 78% if you are current on payments.
Why is my APR higher than my interest rate?
Because the APR includes points and fees paid up front, spread over the loan. If you pay no points or fees, the two are almost the same.