Mortgage Calculator

How to calculate your mortgage payments

Calculating mortgage payments can be a bit complicated at times, but TourDay's Mortgage Calculator allows you to find your answer in just a few clicks!

First, in the prompt labeled "Home price," enter the price or the current value of your home

**HINT: If you’re using a mortgage calculator to decide how much you can afford to spend on a home, you are underestimating how much you’ll have to pay each month. 

 A down payment is the cash you pay upfront for a home, and home equity is the value of the home, minus what you owe. You can enter either a dollar amount or the percentage of the purchase price you’re putting down.

The Formula Behind the Calculations:

The mortgage payment calculation looks like this:

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

The variables are as follows:

M = monthly mortgage payment
P = the principal amount
i = your monthly interest rate.

Your lender likely lists interest rates as an annual figure, so you’ll need to divide by 12, for each month of the year. So, if your rate is 5%, then the monthly rate will look like this: 0.05/12 = 0.004167.
n = the number of payments over the life of the loan. If you take out a 30-year fixed-rate mortgage, this means n = 30 years x 12 months per year, or 360 payments.

The Benefits of the Calculator:

Determining what your monthly house payment will be is an important part of figuring out how much house you can afford. That monthly payment is likely to be the biggest part of your cost of living.

What’s included in my mortgage payment?

A typical monthly mortgage payment has four parts: principal, interest, taxes and insurance. These are commonly referred to as PITI.

The mortgage payment estimate you’ll get from this calculator includes principal and interest. 

This calculator doesn’t include homeowners insurance, property taxes, or guarantee fees. Those could be part of your monthly mortgage payment depending on your financial situation and the type of loan you choose.