Mortgage interest calculator
This mortgage interest calculator shows how much interest you will pay in total and in the first year, and how a lower rate or shorter term cuts it.
Amortization schedule
| Year | Principal | Interest | Balance |
|---|---|---|---|
| 1 | $3,836.66 | $24,182.74 | $356,163.34 |
| 2 | $4,103.80 | $23,915.60 | $352,059.54 |
| 3 | $4,389.53 | $23,629.87 | $347,670.01 |
| 4 | $4,695.17 | $23,324.23 | $342,974.84 |
| 5 | $5,022.07 | $22,997.33 | $337,952.77 |
| 6 | $5,371.76 | $22,647.64 | $332,581.01 |
| 7 | $5,745.77 | $22,273.63 | $326,835.24 |
| 8 | $6,145.84 | $21,873.56 | $320,689.40 |
| 9 | $6,573.76 | $21,445.64 | $314,115.64 |
| 10 | $7,031.48 | $20,987.92 | $307,084.16 |
| 11 | $7,521.07 | $20,498.33 | $299,563.09 |
| 12 | $8,044.74 | $19,974.66 | $291,518.35 |
| 13 | $8,604.88 | $19,414.52 | $282,913.47 |
| 14 | $9,204.02 | $18,815.38 | $273,709.45 |
| 15 | $9,844.89 | $18,174.51 | $263,864.56 |
| 16 | $10,530.37 | $17,489.03 | $253,334.19 |
| 17 | $11,263.57 | $16,755.83 | $242,070.62 |
| 18 | $12,047.84 | $15,971.56 | $230,022.78 |
| 19 | $12,886.70 | $15,132.70 | $217,136.08 |
| 20 | $13,783.97 | $14,235.43 | $203,352.11 |
| 21 | $14,743.70 | $13,275.70 | $188,608.41 |
| 22 | $15,770.31 | $12,249.09 | $172,838.10 |
| 23 | $16,868.37 | $11,151.03 | $155,969.73 |
| 24 | $18,042.85 | $9,976.55 | $137,926.88 |
| 25 | $19,299.15 | $8,720.25 | $118,627.73 |
| 26 | $20,642.91 | $7,376.49 | $97,984.82 |
| 27 | $22,080.23 | $5,939.17 | $75,904.59 |
| 28 | $23,617.64 | $4,401.76 | $52,286.95 |
| 29 | $25,262.07 | $2,757.33 | $27,024.88 |
| 30 | $27,024.88 | $998.38 | $0.00 |
Why total mortgage interest is so large
Over 30 years at today’s rates, interest can equal or exceed the amount borrowed. That is the price of spreading the loan over a long time. A 15-year loan costs far less in interest because the balance falls faster and the rate is usually lower.
Reducing the interest
The levers are a larger down payment, a lower rate (shop several lenders, consider paying points if you will stay long enough), a shorter term and extra principal payments. Whether mortgage interest is deductible depends on your tax situation and current law, so ask a tax professional.
$360,000 loan: 15-year vs 30-year
On a $360,000 mortgage, a 30-year loan at 6.75% costs $2,334.95 a month in principal and interest and $480,586 in total interest. A 15-year loan at a rate about 0.6 points lower costs $3,067.14 a month, $732.19 more, but cuts the interest to $192,084, saving $288,502. The right choice depends on whether the higher payment fits your budget with room to spare.
| Loan | Principal & interest | Total interest | Total paid |
|---|---|---|---|
| 10-year at 6.15% | $4,023.91 | $122,869 | $482,869 |
| 15-year at 6.15% | $3,067.14 | $192,084 | $552,084 |
| 20-year at 6.15% | $2,610.40 | $266,497 | $626,497 |
| 30-year at 6.75% | $2,334.95 | $480,586 | $840,586 |
What each 6.75% ± 1 point does to the payment
A one-point change in your mortgage rate moves the payment on $360,000 by roughly $244.13 a month and the lifetime interest by about $87,889 over 30 years. That is why it pays to compare several lenders on the same day.
| Rate | Principal & interest | Total interest | Difference vs 6.75% |
|---|---|---|---|
| 5.75% | $2,100.86 | $396,312 | −$84,274 |
| 6.25% | $2,216.58 | $437,971 | −$42,615 |
| 6.75% | $2,334.95 | $480,586 | +$0 |
| 7.25% | $2,455.83 | $524,105 | +$43,519 |
| 7.75% | $2,579.08 | $568,474 | +$87,889 |
Down payment and PMI on a $450,000 home
With less than 20% down, lenders charge private mortgage insurance (PMI), commonly 0.3% to 1.5% of the loan per year. This page assumes 0.6%. PMI usually ends when you reach 80% of the home's original value, which you can reach sooner with extra payments.
| Down payment | Loan amount | PMI / month | Total monthly payment |
|---|---|---|---|
| 5% ($22,500) | $427,500 | $213.75 | $3,524.01 |
| 10% ($45,000) | $405,000 | $202.50 | $3,366.82 |
| 20% ($90,000) | $360,000 | $0.00 | $2,872.45 |
What income does a $450,000 home need?
Lenders often look at a front-end ratio of about 28% of gross income for housing costs. A total payment of $2,872.45 implies a gross income near $123,000 a year, and lenders also weigh your other debts, which usually must keep total payments under about 36% to 43% of income.
In the first year, $24,183 of your payments goes to interest and only $3,837 to principal, so equity builds slowly at first.
How fast you build equity
Equity here is the home price minus the loan balance, assuming the price stays flat. Appreciation, if any, would add to it.
| After | Loan balance | Principal repaid | Equity (flat value) |
|---|---|---|---|
| 5 years | $337,953 | $22,047 | $112,047 |
| 10 years | $307,084 | $52,916 | $142,916 |
| 15 years | $263,865 | $96,135 | $186,135 |
| 20 years | $203,352 | $156,648 | $246,648 |
Frequently asked questions
How much interest will I pay on a 30-year mortgage?
At 6.5%, roughly 128% of the loan amount over the full term. The calculator shows your exact figure.
Do points lower my interest cost?
Paying points buys a lower rate. They pay off only if you keep the loan beyond the break-even point.
What is the monthly payment on a $360,000 mortgage?
At 6.75% over 30 years, principal and interest on $360,000 is $2,334.95. With the estimated tax, insurance, HOA and PMI above, the total comes to about $2,872.45 a month.
What is included in a monthly mortgage payment?
Principal and interest are the loan itself. Many lenders also collect property tax and homeowners insurance in escrow, and charge PMI if your down payment is under 20%. HOA dues are paid separately.
Related calculators
Estimates from standard loan formulas, not a loan offer or financial advice. Example rates are assumptions: use your own quote.