How this calculator works
Principal and interest use the standard amortization formula: payment = loan × r ÷ (1 − (1 + r)^−n), where r is the monthly rate (annual rate ÷ 12) and n is the number of monthly payments.
The loan amount is the price minus your down payment. Property tax is entered as a percentage of the price per year, because that is how most counties set it; rates range from under 0.5% to over 2% depending on where you live.
Private mortgage insurance (PMI) applies to conventional loans with less than 20% down. It is entered as a yearly percentage of the loan, commonly about 0.3% to 1.5% depending on credit score and down payment.
Insurance and HOA dues are added as monthly amounts. The total is what typically leaves your account each month when taxes and insurance are paid through an escrow account.
Worked example
$400,000 home, 20% down, 6.5% for 30 years
- Loan: $400,000 − $80,000 = $320,000. Principal and interest: $2,022.62 a month.
- Property tax at 1.1%: $366.67 a month. Insurance at $1,800 a year: $150. No PMI with 20% down.
- Total monthly payment: $2,539.28. Interest over 30 years: about $408,000.
Questions people ask
How much house payment can I afford?
A common guideline is to keep housing costs under 28% of gross monthly income and all debts under 36%. The house affordability calculator applies those limits to your numbers.
How do I get rid of PMI?
On conventional loans you can ask to cancel PMI when your balance reaches 80% of the home’s original value, and it must end automatically at 78%. Paying extra principal gets you there sooner.
Is a 15-year mortgage better than a 30-year?
A 15-year loan usually has a lower rate and costs far less interest, but the monthly payment is much higher. A 30-year loan with optional extra payments keeps flexibility.
Sources
Last reviewed October 2, 2026