How a mortgage calculation works
A mortgage calculator estimates the fixed monthly payment required to pay back a home loan over a specified term. The core formula for an amortizing fixed-rate mortgage is:
M = P × r × (1 + r)^n / ((1 + r)^n − 1)
Where M is the monthly payment, P is the loan principal (home price minus down payment), r is the monthly interest rate (annual rate divided by 12), and n is the total number of monthly payments (loan term in years × 12). This payment is constant each month, but its composition shifts: early payments are mostly interest, while later payments are mostly principal.
What's included in the monthly payment
The "total monthly payment" shown above may include several components beyond just principal and interest (P&I):
- Principal & Interest (P&I) — the amortizing loan payment itself.
- Property Tax — an annual levy by local government, typically paid monthly into an escrow account by US lenders.
- Home Insurance — protects against property damage; typically required by lenders.
- PMI (Private Mortgage Insurance) — US-specific; required when your down payment is less than 20% of the home price. Usually removed once you reach 20% equity.
- HOA / Maintenance — for condominiums and planned communities, a monthly fee covering shared upkeep.
Country-specific notes
United States
The 30-year fixed-rate mortgage is the dominant product. Current rates (2026) hover around 6–7% for prime borrowers. A 20% down payment avoids PMI. Property taxes vary widely by state (from ~0.3% in Hawaii to ~2.5% in New Jersey). The calculator uses 1.1% as a US average — adjust for your state.
China (中国)
Most Chinese mortgages are commercial loans tied to the Loan Prime Rate (LPR), which the PBoC publishes monthly. First homes typically require 20–30% down; second homes 40%+ depending on city tier. Many buyers use a combination loan of commercial + Housing Provident Fund (HPF/公积金), which this calculator does not model separately — enter your blended rate manually.
Russia (Россия)
Mortgage rates in Russia are highly bifurcated: market rates often exceed 18% (2026), but subsidized programs like Family Mortgage (семейная ипотека) and IT Mortgage can offer 6–8%. Life and property insurance are typically required. Terms are usually 15–25 years.
Indonesia (KPR)
KPR (Kredit Pemilikan Rumah) is offered by major Indonesian banks. Rates are commonly floating (10–12% in 2026) with a 1–3 year fixed teaser period (5–7%) that expires. Many banks also require life insurance (asuransi jiwa) and fire insurance (asuransi kebakaran). PBB (property tax) is relatively low at ~0.1–0.3% annually.
Tips for using this calculator
- Try a 15-year term. Cutting the term from 30 to 15 years roughly doubles your monthly payment but can cut total interest paid by more than 60%.
- Use the extra payment field. Even $100/month extra on a 30-year loan can save tens of thousands in interest and shorten the loan by years.
- Compare rates. A 0.5% lower rate on a $400,000 / 30-year loan saves roughly $120/month and ~$43,000 over the life of the loan.
- Don't forget closing costs. Not shown here, but typically 2–5% of the loan amount.
FAQ
Does this calculator save my data?
No. All calculations happen entirely in your browser. Nothing is sent to our servers. See our privacy policy.
Can I use this for a refinance?
Yes — enter the new loan amount as the "Home Price − Down Payment" and use the new interest rate and term. Compare the result with your current payment to see if refinancing is worthwhile.
What about ARM (adjustable-rate) mortgages?
This calculator models a fixed-rate mortgage. For an ARM, enter the initial fixed rate to see your starting payment; your actual payments will change when the rate adjusts.
Disclaimer: This calculator provides estimates for informational purposes only and does not constitute financial advice. Actual loan terms depend on your lender, credit profile, and local regulations.