Cnn Money Mortgage Calculator

This mortgage calculator helps you estimate your monthly payments, total interest, and amortization schedule. Whether you're a first-time homebuyer or refinancing, understanding these numbers is key to making informed financial decisions.

How to Use This Calculator

Enter your loan details in the calculator panel on the right. The calculator will show you:

Estimated monthly payment
Total interest paid over the life of the loan
Amortization schedule visualization

The calculator uses standard mortgage formulas and assumes a fixed interest rate. For the most accurate results, use your exact loan terms.

Formula Used

The monthly payment (M) is calculated using the formula:

M = P [i(1 + i)^n] / [(1 + i)^n - 1]

Where:

P = Principal loan amount
i = Monthly interest rate (annual rate divided by 12)
n = Number of payments (loan term in years multiplied by 12)

Total interest paid is calculated by multiplying the monthly payment by the number of payments and subtracting the principal loan amount.

Worked Example

Let's calculate a mortgage for $200,000 at 4% annual interest for 30 years:

Convert annual rate to monthly: 4% ÷ 12 = 0.3333%
Number of payments: 30 years × 12 = 360
Plug into formula: M = 200,000 [0.003333(1 + 0.003333)^360] / [(1 + 0.003333)^360 - 1]
Calculate monthly payment: $1,073.64
Total interest paid: ($1,073.64 × 360) - $200,000 = $142,454.40

Note: This is an estimate. Your actual payment may vary based on exact loan terms and additional fees.

Interpreting Results

Your monthly payment includes both principal and interest. Over time, the portion of each payment going toward principal increases while the interest portion decreases.

Consider these factors when evaluating your mortgage:

Affordability: Can you comfortably pay the monthly payment plus other expenses?
Interest rate: A lower rate saves you money over the life of the loan
Loan term: Shorter terms mean higher monthly payments but less total interest
Down payment: A larger down payment reduces your principal and may qualify you for better rates

Frequently Asked Questions

What is the difference between APR and interest rate?: APR (Annual Percentage Rate) includes all fees and costs, while the interest rate is just the cost of borrowing. APR is always higher than the interest rate.
How does prepayment affect my mortgage?: Making extra payments reduces your principal faster and may save you money on interest. However, some loans have prepayment penalties.
What is PMI and when do I need it?: PMI (Private Mortgage Insurance) protects lenders if you don't put at least 20% down. It's typically required for conventional loans with less than 20% down.
Can I change my mortgage term?: Yes, you can refinance to change your term or rate, but there may be fees and closing costs involved.
What happens if I can't make my mortgage payment?: Missing payments can lead to late fees, higher interest rates, and potential foreclosure. Contact your lender immediately if you're having trouble.