Estimate your monthly payment, total interest and payoff schedule.
| Year | Principal | Interest | Balance |
|---|---|---|---|
A fixed-rate mortgage is repaid through equal monthly payments over its term — a process called amortization. Each payment is split two ways: part covers the interest charged on the outstanding balance that month, and the rest reduces the principal you owe. Because the payment is fixed but the balance shrinks over time, the split gradually shifts from mostly interest toward mostly principal.
Here P is the loan amount, r is the monthly interest rate (the annual rate divided by 12) and n is the total number of monthly payments (years × 12). The formula produces the single payment that will clear the loan exactly at the end of the term. The calculator applies it and then walks through the schedule month by month to total the interest and build the yearly table.
Over a 30-year term, the interest paid can rival or exceed the amount borrowed. That is because interest accrues on the balance every month for decades. Shortening the term or securing a lower rate has an outsized effect on the total cost, even though it may raise the monthly payment. Comparing a 15-year and a 30-year option side by side is one of the most valuable things this calculator can show you.
This is a principal-and-interest estimate. A real monthly housing cost also includes property taxes, homeowners insurance, and possibly private mortgage insurance or HOA fees. Those depend on your property and location, so treat the payment here as the loan portion of your budget and add local costs on top.
It uses the amortization formula M = P·r·(1+r)ⁿ ÷ ((1+r)ⁿ−1), where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12) and n is the number of monthly payments. The result is a fixed payment that covers both interest and principal.
Interest is charged on the outstanding balance, which is highest at the start. Early payments are mostly interest and little principal; as the balance falls, more of each payment goes to principal. The amortization table shows this shift year by year.
Amortization is the process of paying off a loan through equal periodic payments. Each payment is split between interest on the remaining balance and a repayment of principal, until the balance reaches zero at the end of the term.
A longer term lowers the monthly payment but increases the total interest paid, because you borrow the money for longer. A 15-year mortgage has higher monthly payments than a 30-year one but costs far less in total interest.
No. This calculates principal and interest only (P&I). Property taxes, homeowners insurance and any HOA or PMI fees are additional and vary by location and lender.