Mortgage Payment Calculator
Calculate your monthly mortgage payment, compare 15 vs 20 vs 30-year terms, and see how extra payments can save thousands in interest and shorten your loan.
Calculate Your Monthly Payment
Enter your loan details to see your monthly principal & interest payment.
Additional amount paid toward principal each month
Monthly Principal & Interest
$1,995.91/mo
Loan Summary
Extra Payment Savings (+$200/mo)
$116,640
Interest Saved
7y 1m
Time Saved
Loan paid off in 22 years 11 months instead of 30 years
15 vs 20 vs 30-Year Comparison
See how different loan terms affect your monthly payment and total interest on a $300,000 loan at 7%.
| Term | Monthly Payment | Total Interest | Total Paid | Interest Saved vs 30yr |
|---|---|---|---|---|
| 15 years | $2,696.48 | $185,367 | $485,367 | $233,159 |
| 20 years | $2,325.90 | $258,215 | $558,215 | $160,311 |
| 30 years | $1,995.91 | $418,527 | $718,527 | --- |
Understanding Mortgage Payments
Your monthly mortgage payment is the foundation of homeownership costs. Understanding how payments are calculated and what factors affect them helps you make better financial decisions.
The Payment Formula
The standard mortgage payment formula is M = P × [r(1+r)n] / [(1+r)n - 1]. This formula creates equal payments that fully amortize the loan over the term. The monthly interest rate is the annual rate divided by 12 (e.g., 7% annual = 0.5833% monthly). The number of payments is the term in years times 12. This is the most important formula for MLO exam candidates to memorize and understand.
Extra Payments Strategy
Making extra payments toward principal is one of the most powerful ways to reduce total mortgage cost. Because extra payments reduce the balance that accrues interest, even small additional amounts can save tens of thousands of dollars. The earlier you start making extra payments, the greater the impact. One additional payment per year (1/12 extra each month) on a 30-year mortgage typically shortens the loan by about 4-5 years.
Mortgage Payments on the MLO Exam
The NMLS SAFE Act exam requires you to understand mortgage payment calculations, the relationship between rate, term, and payment amount, and how payments are applied to principal and interest over time. You should be able to explain to a borrower how their monthly payment is determined, why a shorter term saves money despite higher payments, and how prepayment affects total loan cost. Understanding the concept of amortization and being able to perform basic payment calculations is fundamental to passing the exam and succeeding as a mortgage loan originator.
Frequently Asked Questions
How is a monthly mortgage payment calculated?
How much does an extra $200/month save on a mortgage?
Is a 15-year mortgage better than a 30-year mortgage?
What is the monthly payment on a $400,000 mortgage?
How does interest rate affect monthly mortgage payment?
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