Mortgage Payment Calculator

Plug in a purchase price, down payment, and rate to see your full monthly payment — principal, interest, taxes, insurance, and PMI. Every number breaks down so you can see exactly where each dollar goes.

Last updated: March 9, 2026

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Loan Details

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Estimated Monthly Payment

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Principal & Interest

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Property Tax

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Insurance

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PMI

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Total Interest Paid

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Total Cost of Home

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Yearly Amortization Schedule +
Year Principal Paid Interest Paid Remaining Balance
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The Math Behind Your Monthly Payment

The principal and interest portion of your mortgage payment uses a standard amortization formula:

M = P × [r(1+r)n] / [(1+r)n − 1]

Where P is the loan principal, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of payments. On a $348,750 loan (90% of $387,500) at 6.75% for 30 years, r = 0.005625 and n = 360, giving a monthly P&I payment of $2,262. The remaining portion of your payment — taxes, insurance, and potentially PMI — gets added on top.

Early in the loan, most of each payment goes to interest. In month one of this example, $1,962 goes to interest and only $300 to principal. By year 15, the split is roughly even. By year 28, nearly the entire payment reduces the balance.

PMI: The 78% vs. 80% LTV Distinction

Private mortgage insurance is required on conventional loans with less than 20% down. On a $348,750 loan, PMI typically runs 0.5% to 1.5% of the loan amount annually — between $145 and $436/month. The rate depends on your credit score, LTV ratio, and loan type.

Two LTV thresholds matter. At 80% LTV, you can request PMI removal, but your lender may require a new appraisal and a history of on-time payments. At 78% LTV, the Homeowners Protection Act requires automatic cancellation based on your original amortization schedule — no request needed. On the $348,750 loan at 6.75%, you hit 78% of the original value (balance of $302,250) around month 103 — roughly 8.5 years in.

If your home has appreciated significantly, you can refinance or request a new appraisal to demonstrate you've crossed 20% equity sooner. In a market where home prices have risen 5% annually, that $387,500 home could appraise at $430,000+ within three years, pushing your effective LTV well below 80%.

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What a Quarter-Point Rate Change Actually Costs

As of March 2026, 30-year fixed rates hover around 6.75%. Each 0.25% change in rate moves your monthly P&I payment by approximately $58 on a $348,750 loan. Over 30 years, that 0.25% difference adds up to about $20,800 in total interest.

At 6.50%, the monthly P&I drops to $2,204. At 7.00%, it rises to $2,320. At 7.50%, you're looking at $2,439 — $177 more per month than at 6.75%, or $63,720 over the life of the loan. That context matters when deciding whether to lock a rate today or float for a potential drop.

15-Year vs. 30-Year: Running the Numbers

The 15-year term typically carries a rate about 0.5% to 0.75% lower than the 30-year. Using $348,750 at 6.0% (15-year) vs. 6.75% (30-year):

  • 30-year at 6.75%: $2,262/month P&I, $465,570 total interest
  • 15-year at 6.0%: $2,943/month P&I, $181,040 total interest

The 15-year term costs $681 more per month but saves $284,530 in interest. You own the home free and clear in half the time. The tradeoff: that extra $681/month invested in the S&P 500 at a historical 10% average annual return would grow to roughly $284,000 over the same 15 years. The gap is slim — which means the decision often comes down to risk tolerance and whether you'd actually invest the difference consistently.

Property Tax Rates Vary More Than You'd Expect

On a $387,500 home, property taxes range dramatically by state:

  • New Jersey (2.23% average): $8,641/year — $720/month added to your payment
  • Texas (1.60% average, no state income tax): $6,200/year — $517/month
  • California (0.71% average, Prop 13 limits increases): $2,751/year — $229/month
  • Hawaii (0.27% average): $1,046/year — $87/month

That's a $633/month spread between New Jersey and Hawaii on the same-priced home. Tax rates also vary within states — a home in suburban Chicago faces rates above 2.5%, while downstate Illinois averages closer to 1.8%. Always check the specific county or municipality, not just state averages.

Larger Down Payment vs. Investing the Difference

Putting 20% down ($77,500) on a $387,500 home eliminates PMI and reduces your loan to $310,000. Compared to 10% down ($38,750), you're tying up an extra $38,750 in the house. Here's the math for each scenario over 30 years at 6.75%:

  • 10% down: $348,750 loan, $2,262 P&I + ~$218 PMI for ~8 years = higher total cost
  • 20% down: $310,000 loan, $2,011 P&I, no PMI = lower total cost

The 20% path saves roughly $251/month in P&I and eliminates $218/month in PMI — about $469/month total at the start. But that $38,750 invested in a diversified index fund averaging 8% annually would grow to approximately $387,000 over 30 years. The invested scenario wins if your returns exceed your mortgage rate after tax benefits — which historically has been the case more often than not. However, the guaranteed return of eliminating PMI (effectively a 6–8% cost of capital) makes the first 8 years more favorable for the larger down payment.

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Frequently Asked Questions

How do I get PMI removed from my mortgage payment?
Under the Homeowners Protection Act, your lender must automatically cancel PMI once your loan balance reaches 78% of the original purchase price — not the current appraised value. You can also request PMI removal at 80% LTV, but the lender may require a current appraisal and a clean payment history (no 30-day lates in the past 12 months, no 60-day lates in the past 24 months). On a $387,500 home with 10% down, automatic PMI cancellation happens when your balance drops to approximately $302,250.
How do mortgage discount points affect my rate and payment?
One discount point equals 1% of the loan amount and typically reduces your interest rate by 0.25%. On a $348,750 loan (90% of $387,500), one point costs $3,487.50 and would lower your rate from, say, 6.75% to 6.50% — saving roughly $62/month on a 30-year term. That means your breakeven is about 56 months (just under 5 years). Points make financial sense if you plan to stay in the home beyond the breakeven period and don't expect to refinance before then.
Should I choose an adjustable-rate mortgage (ARM) over a fixed rate?
A 5/1 ARM offers a lower initial rate — often 0.5% to 1% below the 30-year fixed rate as of March 2026. On a $348,750 loan, a 5/1 ARM at 6.0% vs. a fixed rate at 6.75% saves about $155/month for the first five years ($9,300 total). The risk: after year five, the rate adjusts annually based on SOFR plus a margin, typically with 2% annual caps and a 5% lifetime cap. ARMs work well if you're confident you'll sell or refinance within the fixed period. If you're staying 10+ years, the fixed rate is almost always the safer bet.
What counts as a jumbo loan, and how does it change my rate?
For 2026, the conforming loan limit is $806,500 in most U.S. counties (higher in designated high-cost areas — up to $1,209,750 in places like San Francisco and New York City). Any loan above your county's limit is a jumbo loan. Jumbo loans typically carry rates 0.25%–0.5% higher than conforming loans and require stronger qualifications: 700+ credit score, 10–20% down payment, and lower debt-to-income ratios (usually 43% max). Some lenders also require 6–12 months of reserves in liquid assets.
What is an escrow account and can I avoid it?
An escrow account holds funds for property taxes and homeowners insurance, which your lender pays on your behalf. About one-twelfth of your annual tax and insurance bills is added to each monthly mortgage payment. On a $387,500 home with 1.1% property tax ($4,262.50/year) and $1,200/year insurance, escrow adds roughly $455/month to your payment. Some lenders allow you to waive escrow if you have at least 20% equity, though they may charge a fee (typically 0.25% of the loan amount) or require a slightly higher rate. Self-managing taxes and insurance means you keep that cash longer, but you're responsible for making those payments on time.

This calculator is for educational purposes. Consult a financial professional for advice specific to your situation. Payment estimates do not include HOA fees, closing costs, or other charges that may apply to your specific loan.

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