Mortgage Calculator

What your monthly payment includes (PITI)

A mortgage payment is usually four things — Principal, Interest, Taxes, and Insurance. This calculator adds two more when they apply: PMI (private mortgage insurance, typically required when your down payment is under 20% / LTV above 80%) and any HOA dues — so the number you see is the true all-in monthly cost, not just principal & interest.

How amortization works

Each month, interest is charged on your remaining balance and the rest of the payment chips away at the principal. Early in the loan almost all of your payment is interest; over the years the split flips toward principal. The year-by-year table above shows exactly how that shift happens and how fast the balance falls — a longer term means a lower payment but far more total interest.

“How much house can I afford?”

A common rule of thumb keeps your housing payment near 28% of gross monthly income (the “front-end” ratio). The estimate above shows the income that guideline implies for your payment — but it’s a rule of thumb, not a qualification. Real approval depends on your total debts, credit, reserves, and the loan program.

Why this one has no strings

Most “free” mortgage calculators are lead funnels — they hold your amortization behind an email, or push “get pre-approved” at every turn. RallyRates is a neutral publisher: we don’t originate, broker, or arrange loans, so this tool asks for nothing about you. Come for the calculator; if you’re shopping, our rate board is just as honest.

A worked example

Buy a $400,000 home with $80,000 down (20%) and you finance $320,000. At a 30-year term and a 6.5% rate, principal and interest come to about $2,023/month. Add property tax (say $4,800/year → $400/month) and homeowner’s insurance ($1,440/year → $120/month) and your true all-in payment is closer to $2,543 — over 25% more than the principal-and-interest figure alone. Because you put 20% down there’s no PMI; drop to 10% down and PMI would add roughly another $130–$270 a month until you reach 20% equity. That gap between the “rate” payment and the real payment is exactly why this calculator shows taxes, insurance, PMI, and HOA rather than just P&I.

What trips people up

• Quoting only principal & interest. Taxes and insurance often add 20–30% to the payment. Budget the all-in PITI number, not the headline P&I.
• Forgetting PMI below 20% down. A smaller down payment means a monthly insurance premium until you build 20% equity — real money this tool folds in.
• Confusing rate and APR. The note rate drives your payment; APR bakes in fees for comparison. See APR vs. interest rate before you compare offers.