Mortgage Calculator Guide — Payment, Amortization & 2026 Rates
Your monthly mortgage payment has two core components: principal (paying down what you borrowed) and interest (the lender's fee). Add property tax, homeowner's insurance, and potentially PMI and you get your full PITI payment — what you actually write the check for each month.
⚡ Mortgage Quick Reference 2026
30yr at 6.8% on $400K$2,608/mo · $538K interest
15yr at 6.1% on $400K$3,407/mo · $213K interest
Interest saved (15 vs 30)~$325K
Rule of thumb monthly payment~$6–7/mo per $1,000 borrowed
PMI thresholdBelow 20% down payment
How the Amortization Chart Works
Every mortgage payment stays the same dollar amount (for fixed-rate loans), but the split between principal and interest shifts dramatically over time. In month 1 of a 30-year mortgage, roughly 85% of each payment is pure interest. By year 20, it flips — most of each payment is principal. This is called amortization, and the chart shows exactly how your equity builds while your balance falls.
15-Year vs 30-Year Mortgage
The 15-year option saves a staggering amount in interest — often $200,000–$400,000 on a typical mortgage — and the rate is usually 0.5–0.75% lower. The trade-off is a payment roughly 40–50% higher each month. The 30-year gives you flexibility: a lower required payment that you can supplement with extra payments in good months, without being forced to.
The Power of Extra Payments
Even small extra payments have outsized impact early in the loan when the balance is high and interest compounds on the most principal. An extra $200/month on a $400,000 loan at 6.8% saves over $60,000 in interest and pays off 5+ years early. The calculator shows your exact savings above.
How is a monthly mortgage payment calculated?+
Monthly P&I = P × [r(1+r)^n] / [(1+r)^n − 1] where P = loan amount, r = monthly interest rate (annual ÷ 12), n = number of payments. A $320,000 loan at 6.8% for 30 years: r = 0.068/12 = 0.00567, n = 360. Monthly P&I = $2,082.
What is PMI and when does it go away?+
PMI (Private Mortgage Insurance) is required when your down payment is below 20% on a conventional loan. It typically costs 0.5–1.5% of the loan amount per year. It drops off automatically once your equity reaches 22% of the original purchase price (by law, under the Homeowners Protection Act). You can request removal at 20%.
What mortgage rate can I expect in 2026?+
As of mid-2026, average 30-year fixed rates are approximately 6.5–7.5%. Factors that lower your rate: credit score 750+, 20%+ down payment, shorter loan term (15yr vs 30yr), buying points. Each 0.25% rate reduction saves roughly $50/month on a $400K loan.
Should I pay points to buy down my rate?+
One point = 1% of loan amount paid upfront to reduce the rate by ~0.25%. On a $400K loan, 1 point = $4,000 and saves ~$55/month. Break-even: $4,000 / $55 = ~73 months (6 years). If you plan to stay 7+ years, buying points is likely worth it. If you might sell or refinance sooner, skip points.
How much house can I afford?+
The standard rule: total housing costs (PITI) should not exceed 28% of gross monthly income (the "front-end DTI"). Total debt payments should not exceed 36–43% of gross income. On $8,000/month gross income: max PITI = $2,240. At 6.8% on a 30yr mortgage, that supports roughly a $340,000 loan (plus down payment).