Your real monthly payment — principal, interest, taxes, insurance and HOA — plus where every dollar goes over the life of the loan.
Principal & interest is the part set by your loan. Taxes and insurance usually get collected into escrow on top of it — that's why your real payment is bigger than the number lenders advertise.
In the early years, most of your payment is interest. That's normal — the table above shows the exact year your balance starts falling fast. If that annoys you, try our extra payment calculator: small extra payments early are absurdly effective.
Estimates are for education, not financial advice. Your lender's exact numbers may differ slightly.
🤝 No signup. No spam. Nothing here tries to sell you a loan.
Your principal-and-interest payment comes from the standard amortization formula lenders use: M = P × r(1+r)n ÷ ((1+r)n − 1), where P is the amount you borrow (home price minus down payment), r is your monthly interest rate (the annual rate divided by 12), and n is the number of monthly payments (years × 12). On top of that principal and interest, we add your property taxes, homeowners insurance, and any HOA dues, because those are collected with most mortgage payments through an escrow account. That "all-in" number is what actually leaves your bank account each month — and it's usually a few hundred dollars more than the payment lenders advertise, which quotes principal and interest only.
Say you buy a $400,000 home with $80,000 down, financing $320,000 at 6.5% over 30 years. The monthly principal and interest works out to about $2,023. Add $4,000 a year in property tax and $1,800 in insurance — roughly $483 a month — and your real payment is about $2,506 a month. Over the full 30 years you'd pay around $408,000 in interest alone, which is why even a small change in rate or term moves the total by tens of thousands of dollars. Try it with your own numbers above, then compare a 15-year term or a lower rate to see the difference.
What does the monthly payment include?
Principal, interest, property tax, homeowners insurance, and HOA if you enter one — the industry shorthand is PITI. Utilities, maintenance, and PMI are not included unless noted.
Why is my real payment higher than the rate suggests?
Because taxes and insurance are bundled into most payments through escrow. A "6.5% payment" that ignores them understates what you'll actually owe.
What about PMI?
If your down payment is under 20%, lenders usually add private mortgage insurance. It typically falls off automatically once you reach 78% of the original value — our guide to removing PMI covers the shortcuts.
15-year or 30-year?
A 15-year loan costs far less interest but a much higher monthly payment. Our 15 vs. 30-year breakdown shows the honest trade with real numbers.
How can I pay less interest overall?
Even small extra principal payments early make a big dent. See the extra payment calculator to watch your payoff date move.