Mortgage calculator.
The whole picture.

How to calculate a monthly mortgage payment

A repayment mortgage spreads principal and interest across a set number of payments. For a fixed rate and equal monthly payments, use:

M = P × r ÷ [1 − (1 + r)^−N]

P is the amount borrowed, r is the monthly interest rate and N is the total number of payments. With a monthly convention, divide the annual percentage by 1,200 to find r. At zero interest, use P ÷ N. Canadian fixed-rate quoting commonly requires the semiannual conversion explained below.

The first payment in our example contains $1,625.00 interest and $271.20 principal. As the balance falls, less of each scheduled payment goes to interest. The schedule shows that change without rounding the running balance after each payment; a lender's penny-rounding and day-count rules can produce small differences.

Principal and interest versus total housing cost

The loan payment is only part of a housing budget. Add annual property tax and home insurance, then enter any recurring mortgage insurance, HOA dues or service charges under other monthly costs. The calculator divides annual costs by 12 and adds your selected extra principal payment. Upfront purchase taxes, closing fees, repairs and utility bills are outside the estimate unless you separately include an appropriate recurring allowance.

Use the actual loan amount, not the purchase price before the down payment. If a mortgage insurance premium is financed into the loan, include it in principal. Enter the contractual interest rate rather than an APR that includes borrowing fees. The CFPB explains this distinction.

What does an extra $200 a month change?

For the $300,000, 6.5%, 30-year example, adding $200 each month repays the loan in 23 years and 1 months and saves $103,448.79 in interest. This assumes all extra payments reduce principal immediately and incur no penalty. Check the prepayment privileges and charges in your own contract.

US, UK and Canadian mortgage assumptions

Changing the market changes the display currency and default interest convention. It does not exchange currencies or apply underwriting rules. For the Canadian fixed-rate option, the monthly rate is (1 + annual rate ÷ 2)^(1 ÷ 6) − 1, using a decimal annual rate. The FCAC sample fixed mortgage disclosure illustrates twice-yearly compounding with monthly payments.

Distinguish your mortgage term from amortization: the contract or fixed-rate deal may end years before the loan is repaid. Future renewal rates are unknown. A UK repayment mortgage or Canadian renewal therefore needs a new scenario when its rate changes. This tool does not assess affordability, qualify an application, or model interest-only and offset products.