Finance
Mortgage Calculator
Calculate monthly mortgage payments including principal, interest, taxes, insurance, and HOA fees.
Inputs
Results
Total Monthly Payment
$0.00
Principal & Interest (P&I)
$0.00
Monthly Property Tax
$0.00
Monthly Insurance
$0.00
HOA Fees
$0.00
Total Loan Amount
$0.00
How It Works
A mortgage calculator estimates your monthly payment by combining Principal & Interest (P&I) with escrow costs like taxes, insurance, and HOA fees. P&I is calculated using an amortizing loan formula based on your borrowing amount and interest rate. Escrow items such as property taxes are generally calculated as a percentage of the purchase price and divided by twelve, while insurance and HOA fees are straight monthly allocations added to the baseline payment.
Formula Used
P&I Payment = P × [r(1+r)^n] / [(1+r)^n − 1]
This standard amortization formula calculates the fixed monthly payment needed to pay off a loan principal P over n months at a monthly interest rate r. It ensures that the principal is fully amortized to zero over the term while charging interest only on the remaining balance.
Monthly Escrow = (Home Price × Property Tax %) / 12 + Annual Home Insurance / 12 + Monthly HOA
This equation aggregates annual tax and insurance liabilities and converts them to monthly installments. By dividing annual costs by twelve, these recurring expenses are accrued evenly and added directly to the baseline principal and interest payment.
Worked Example
Here is a step-by-step example of how these values are calculated:
Home Price
$400,000
Down Payment
20% ($80,000)
Interest Rate
6.5%
Term
30 Years
Property Tax
1.2%
Insurance
$1,200/yr
Result: Total Monthly Payment: $2,542.62 (comprising $2,022.62 P&I, $400.00 Property Tax, $120.00 Insurance)
Frequently Asked Questions
What is included in a PITI mortgage payment?
PITI stands for Principal, Interest, Taxes, and Insurance. It represents the comprehensive cost of your monthly mortgage output including local property taxes and home insurance premiums.
Does this mortgage calculator include PMI?
No, this calculator focuses on standard PITI + HOA. Private Mortgage Insurance (PMI) is usually required if your down payment is less than 20%, which typically adds 0.5% to 1.5% of the loan amount annually to your payments.