Planning to buy a home? Use our free mortgage calculator to instantly determine your monthly payment, total interest, and amortization schedule. Our mortgage calculator accounts for loan amount, interest rates, property taxes, and homeowners insurance, giving you a complete picture of your monthly housing costs. Whether you’re a first-time homebuyer or refinancing an existing mortgage, our tool helps you understand your financial commitment before applying for a loan. With just a few inputs, get accurate results in seconds.

Understanding Your Monthly Payment Breakdown

Your mortgage payment has four major components, often called PITI. Principal and interest is the largest part—in early years most goes to interest (the lender’s profit); in later years more goes toward principal (your equity building). A $280,000 mortgage at 6.2% over 30 years equals $1,694/month in principal and interest alone. Property taxes vary wildly by state and location. New Jersey averages 0.88% of home value annually, while Alabama is only 0.41%. On a $350,000 home, that’s $3,080/year in New Jersey versus $1,435/year in Alabama—a $1,645 difference annually just from geography. Property taxes increase over time as your home appreciates.

Homeowners Insurance

Protects your property structure from fire, theft, and liability claims. Costs $1,000-2,000 annually depending on location, home age, and coverage level. Lenders require this as a condition of the mortgage. Shop insurance quotes from 3+ companies—premiums vary significantly. Insurance costs increase 3-5% yearly.

PMI (Private Mortgage Insurance)

Required if your down payment is less than 20%. PMI protects the lender if you default, not you. Costs 0.5% to 1% of the loan amount annually. On a $280,000 loan with a 10% down payment, you’d pay between $1,400 and $2,800 per year in PMI. Good news: PMI can be removed once your home equity reaches 20%, which usually takes 5-7 years of regular payments.

2026 Mortgage Rates & Market Context

Federal Reserve policy heavily influences mortgage rates. In 2026, expect rates around 5.8-6.5% for 30-year fixed mortgages, slightly lower than 2025 peaks of 7-8%. Rates fluctuate weekly based on economic data and Fed announcements. Better credit scores (760+) qualify for 0.5-1% lower rates. Each 0.5% rate difference equals $150/month difference on a $280,000 loan, which is $54,000 over 30 years. Always shop rates with 3+ lenders before committing.

Factors That Affect Your Rate

Credit score matters most. A 760+ score gets the best rates. Each 50-point credit drop increases the rate by 0.25%. A down payment also impacts rate—20%+ gets the best rates, 10-20% gets slightly higher rates, and under 10% gets the highest rates. Your debt-to-income ratio affects approval and rates. Lenders prefer max 43% for best rates. Market conditions change weekly based on Fed policy, so watch announcements for predictions.

How Much House Can You Afford? The 28/36 Rule

Don’t buy based on purchase price alone. Your monthly payment is the reality check. The 28/36 rule is industry standard: housing costs should max out at 28% of your gross monthly income, and total debt (all loans) should max out at 36%. Example: $100,000 annual salary equals $8,333/month gross income. Max housing is 28%, which equals $2,333/month. Max total debt is 36%, equal to $3,000/month. If you already have a $500/month car payment, your maximum housing budget becomes $2,500 total, not $2,333. Many first-time buyers ignore this rule and stretch too far. Lenders will often approve more than you can safely afford. Don’t rely on lender pre-approval alone.

15-Year vs 30-Year Mortgages: Which Is Right?

30-year mortgage: $280,000 at 6.2% equals $1,694/month; total interest paid exceeds $330,000; total cost over life of loan reaches $610,000+. 15-year mortgage: the same $280,000 at 5.8% equals $2,145/month; the total interest paid is $107,000; and the total cost is $387,000. The 15-year mortgage costs $223,000 less in interest but requires a $400+ higher monthly payment. Choose a 30-year if cash flow is tight or you need flexibility. Choose a 15-year if you can comfortably afford the higher payment and want to own the home faster. Pro tip: You can start with a 30-year mortgage and pay extra toward principal each month. This gives you flexibility if your situation changes while still achieving 15-year payoff benefits without the forced higher payment.

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