To get the most accurate mortgage calculator results possible, experiment with different values to see how these changes impact your monthly costs. Since it offers general estimates, it’s still best to consult a mortgage expert for personalized, accurate advice.
Mortgage Calculator With PMI and Taxes: Estimate How Much House You Can Afford
Updated: February 4, 2025
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Simply Estimate Your Loan Payments, Taxes & PMI.
Updated: Jul 1, 2025
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How to Use MoneyGeek’s Mortgage Calculator
Our mortgage calculator will help you understand your options when purchasing a home. The calculator simplifies the math and provides insights into your monthly payments and overall expenses to help with budgeting. Here’s how to use it to get the most accurate mortgage calculator results possible:
- 1
Input the home's price
Enter the full purchase price to calculate your potential loan amount.
- 2
Enter the down payment
Input your upfront payment, in dollars or as a percentage, to determine your mortgage balance and need for PMI.
- 3
Select the loan's term
Choose the duration of your mortgage (10, 15, 20 or 30-year terms) to understand the long-term financial impact and payment schedule.
- 4
Input the interest rate
Enter your lender's annual rate to see how interest will affect your monthly payments and total loan cost.
- 5
Add in any additional fees
Input monthly or yearly amounts for property tax, homeowners insurance, private mortgage insurance (PMI) and HOA fees, if applicable. These contribute to the total monthly payment and give a realistic view of financial obligations.
Property tax is typically a percentage of the home's value. Insurance covers potential damage, PMI is required for down payments under 20% and HOA fees are applied if your property is within a homeowners' association.
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Leverage the results
The calculator provides a detailed breakdown of monthly payments (principal, interest, taxes, insurance and fees) and an amortization schedule.
HOW MUCH HOUSE CAN YOU AFFORD?
As a starting point, the “28/36 rule” is a guideline that can help you determine how much house you can afford. It suggests that no more than 28% of your gross monthly income should go towards housing expenses and that your total debt payments should not exceed 36% of your income. This way, you’re more likely to maintain a balanced budget that allows for saving.
How to Calculate Your Mortgage Payments by Hand
While a mortgage calculator will help you determine your monthly mortgage payments, there’s no harm in knowing how to get this information with a pencil and paper. This will give you a better understanding of how the underlying factors influence what you pay out of pocket.
To calculate your mortgage payments, have the following information ready:
P = Principal loan amount (the amount borrowed) i = Monthly interest rate (your annual interest rate divided by 12) n = Number of months to repay the loan (loan term in years multiplied by 12)
Apply these values to the formula M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1], where M is your monthly mortgage payment.
You can also use the PMT formula in Excel or Google Sheets to calculator your P&I payment: =PMT(i, n, P)
Where: i = Monthly interest rate (your annual interest rate divided by 12) n = Number of payments (loan term in years multiplied by 12 months) P = Principal loan amount (with a negative number representing the amount borrowed)
Sample Scenario
You want to borrow $200,000 at an annual interest rate of 6% for 30 years.
First, convert the interest rate to a monthly rate. The 6% annual becomes 0.5% monthly (0.005 as a decimal).
Next, convert the loan term into months. Thirty years becomes 360 months (30 years x 12 months/year).
Plug these values into the formula so it appears as follows:
M = $200,000 [ 0.005(1 + 0.005)^360 ] / [ (1 + 0.005)^360 – 1] = $200,000 * (0.30 / 5.022)
That comes up to $1,194 per month, excluding any additional fees.
MONEYGEEK EXPERT TIP
A mortgage calculator is a great way to dream up your ideal monthly payment. Start by entering the home prices from some properties you've seen and love online, and then begin playing with different down payment amounts to find your financial sweet spot. It's best to enter an interest rate that's a little higher than the current rate to build somewhat of a buffer. When it comes time to speak with a lender, you'll have your own understanding of how much you can afford each month, and you'll be better able to balance your numbers versus the maximum monthly amount they'll share with you. — Timothy Manni, Mortgage and Real Estate Consultant
How a Mortgage Calculator Helps
The most reliable mortgage calculators are an excellent tool for prospective homeowners, especially when evaluating the impact of different loan terms or the potential savings from a larger down payment. Let’s explore some scenarios where using a mortgage calculator can help with financial choices.
Choosing the Right Mortgage Term for Your Budget
Meet Julia, a teacher from Nashville who's navigating the complexities of buying her first home on a tight budget. Aware that her monthly income needs to cover not only mortgage payments but also other living expenses and savings, she's keen to make a well-informed decision that balances short-term affordability and long-term costs.
HOW DOES A RELIABLE MORTGAGE CALCULATOR HELP?
The most accurate mortgage calculators help Julia experiment with different loan terms. She found that opting for a 30-year mortgage, while increasing the total interest paid over the life of the loan, would result in substantially lower monthly payments compared to a 15-year mortgage. Since Julia valued the immediate benefit of lower monthly payments to maintain her lifestyle and handle unexpected expenses, she felt the higher overall interest was an acceptable tradeoff.
Paying Up to Pay Less
Alex is an engineer in San Diego who is in the process of buying his first home. He has saved $50,000 but is weighing how much to use for the down payment. He wants to keep enough funds for other investments and potential emergencies; that's where the most accurate mortgage calculators come in.
HOW DID THE MORTGAGE CALCULATOR HELP?
Using a mortgage calculator, Alex played with different down payment scenarios for a $400,000 home. He explored putting down $30,000 versus $40,000. After considering his options, he decided on the $40,000 down payment. It struck the best balance between reducing his debt load and maintaining a robust financial safety net.
A Photographer’s Path to Financial Independence
Angel, a freelance photographer from Portland, recently inherited a small sum of money. She's considering using this unexpected windfall to make extra payments on her $300,000 mortgage. Angel dreams of financial freedom and is exploring how best to use her inheritance to decrease her long-term financial commitments.
HOW DID THE MORTGAGE CALCULATOR HELP?
Using a mortgage calculator, Angel calculated the effects of making additional monthly payments on her mortgage. By adding $200 extra each month, she discovered she could shorten her loan term by several years and save a substantial amount in interest.
Encouraged by these findings, Angel decided to apply the extra payments. It would shorten the timeline to becoming mortgage-free and provide significant interest savings, perfectly aligning with her goals for financial independence.
Cutting Costs With Calculations
Marcus is an IT consultant in Austin who bought his home two years ago with a smaller down payment. As a result, he's been paying private mortgage insurance (PMI) along with his regular mortgage payments. Keen to reduce his monthly expenses, Marcus is investigating when he can eliminate this extra cost. That's where a mortgage payment calculator with PMI and taxes comes in.
HOW DID THE MORTGAGE CALCULATOR HELP?
Marcus explored his amortization schedule using a mortgage calculator and pinpointed when he would achieve 20% equity in his home — the point when he can request the removal of PMI on his conventional loan.
He found that with a few extra payments toward the principal, he could reach this milestone sooner. Motivated, Marcus increases his monthly payments slightly, accelerating his equity buildup and paving the way to dropping his PMI, thus lowering his overall monthly expenses. He was able to better determine how much he owes with an accurate mortgage estimator with taxes and PMI.
How to Lower Your Monthly Mortgage Payments
Securing a mortgage is a long-term financial commitment, and finding ways to lower monthly mortgage payments can provide financial flexibility and security over your loan's lifetime. In addition to using an accurate mortgage payment calculator with PMI and taxes to get a better estimation of your future payments, here are some additional strategies to consider that may help you lower your payments:
Buy a less expensive home
Opting for a more affordable property directly reduces the principal amount of your mortgage. A lower principal means lower monthly payments, making this a straightforward strategy for staying within your budget.
Seek a lower interest rate
A lower rate reduces the amount you pay in interest each month. Improving your credit score before applying can qualify you for these lower rates. A better credit score signals lower risk to lenders, prompting them to offer more favorable terms.
Explore different mortgage types
Different mortgage products have varying payment terms and rates. For example, adjustable rate mortgages (ARMs) typically offer lower initial rates compared to fixed-rate mortgages, leading to lower initial monthly payments.
Mortgage Calculator FAQ
We answered some common questions to enhance your understanding of mortgage calculators and equip you with the knowledge to maximize their potential.
What is included in monthly mortgage payments?
Monthly mortgage payments typically include principal, interest, property taxes, homeowner's insurance and possibly private mortgage insurance (PMI) if your down payment is less than 20%.
How do interest rates affect monthly payments?
Higher interest rates increase monthly payments and the total cost of the loan. In comparison, lower rates decrease these payments, making the loan more affordable over time.
How does a down payment affect monthly mortgage payments?
A larger down payment reduces the loan amount, thereby decreasing monthly payments and potentially eliminating the need for PMI, which further reduces monthly costs.
How does the loan term (for example, 15 years vs. 30 years) impact monthly payments and total interest paid?
Shorter loan terms, like 15 years, result in higher monthly payments but considerably lower total interest paid over the life of the loan than longer terms, such as 30 years.
Why might actual mortgage payments be different from the calculated amount?
Actual mortgage payments can differ due to variations in local property taxes, insurance rates and changes in interest rates, as well as lender-specific fees that may not be included in the initial calculation.
Can you use the calculator for adjustable-rate mortgages (ARMs)?
Sort of. When using a mortgage calculator for an ARM, you will be able to see what your monthly payment and amortization will look like for the initial fixed-rate portion of your loan. After the rate adjusts, your monthly payment and amortization will look different. You can use a mortgage calculator to enter different interest rates to prepare yourself financially for your adjusted rate and new payment.
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About Zachary Romeo, CBCA
Zachary Romeo is a certified Commercial Banking and Credit Analyst (CBCA), and the Head of Loans and Banking at MoneyGeek. Previously, he led production teams for some of the largest online informational resources in higher education, with over 13 years of experience in editorial production.
Romeo has a bachelor's degree in biological engineering from Cornell University. He geeks out on minimizing personal debt and helping others do the same through people-first content.