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PMI not required
LTV of 80% keeps the loan at or below 80% of price, so most lenders skip PMI.
Monthly payment estimate
Mortgage Calculator
Estimate the financing side of a property purchase, including PITI, PMI, total interest, and a year-by-year amortization summary.
Your numbers
Overview
What is a mortgage calculator?
A mortgage calculator estimates a monthly principal and interest payment based on purchase price, down payment, interest rate, and loan term. Adding property taxes, insurance, HOA, and PMI gives the full PITI payment.
What your scenario is telling you
Interest exceeds principal
Estimated total interest of $390,625 is more than the original loan of $280,000 over the full term.
Year-by-year principal and interest
| Year | Principal paid | Interest paid | Cum. interest | Remaining balance | Equity from paydown |
|---|---|---|---|---|---|
| 1 | $2,844 | $19,510 | $19,510 | $277,156 | $2,844 |
| 2 | $3,050 | $19,304 | $38,814 | $274,106 | $5,894 |
| 3 | $3,270 | $19,084 | $57,898 | $270,835 | $9,165 |
| 4 | $3,507 | $18,847 | $76,745 | $267,329 | $12,671 |
| 5 | $3,760 | $18,594 | $95,339 | $263,568 | $16,432 |
| 6 | $4,032 | $18,322 | $113,661 | $259,536 | $20,464 |
| 7 | $4,324 | $18,031 | $131,692 | $255,213 | $24,787 |
| 8 | $4,636 | $17,718 | $149,410 | $250,577 | $29,423 |
| 9 | $4,971 | $17,383 | $166,793 | $245,605 | $34,395 |
| 10 | $5,331 | $17,024 | $183,816 | $240,275 | $39,725 |
| 11 | $5,716 | $16,638 | $200,454 | $234,559 | $45,441 |
| 12 | $6,129 | $16,225 | $216,679 | $228,429 | $51,571 |
| 13 | $6,572 | $15,782 | $232,461 | $221,857 | $58,143 |
| 14 | $7,047 | $15,307 | $247,768 | $214,810 | $65,190 |
| 15 | $7,557 | $14,797 | $262,565 | $207,253 | $72,747 |
| 16 | $8,103 | $14,251 | $276,816 | $199,150 | $80,850 |
| 17 | $8,689 | $13,665 | $290,481 | $190,461 | $89,539 |
| 18 | $9,317 | $13,037 | $303,519 | $181,144 | $98,856 |
| 19 | $9,991 | $12,364 | $315,882 | $171,153 | $108,847 |
| 20 | $10,713 | $11,641 | $327,523 | $160,440 | $119,560 |
| 21 | $11,487 | $10,867 | $338,390 | $148,953 | $131,047 |
| 22 | $12,318 | $10,036 | $348,427 | $136,635 | $143,365 |
| 23 | $13,208 | $9,146 | $357,573 | $123,427 | $156,573 |
| 24 | $14,163 | $8,191 | $365,764 | $109,264 | $170,736 |
| 25 | $15,187 | $7,167 | $372,932 | $94,077 | $185,923 |
| 26 | $16,285 | $6,070 | $379,001 | $77,793 | $202,207 |
| 27 | $17,462 | $4,892 | $383,893 | $60,331 | $219,669 |
| 28 | $18,724 | $3,630 | $387,523 | $41,607 | $238,393 |
| 29 | $20,078 | $2,276 | $389,800 | $21,529 | $258,471 |
| 30 | $21,529 | $825 | $390,625 | $0 | $280,000 |
How investors usually read these numbers
| Metric | Often strong | Watch out | Why it matters |
|---|---|---|---|
| Loan-to-value | 75% to 80% or lower | Above 85% | Measures leverage and how much equity cushion exists at purchase. Affects rate, PMI, and risk. |
| Monthly PITI plus HOA | Covered by conservative rent assumptions | Near or above expected rent | Debt and ownership costs are usually the largest cash-flow drag on a leveraged property. |
| Total interest | Acceptable relative to your hold period | Equal to or greater than the loan amount | Long terms keep payments low but can mean paying as much in interest as principal over the loan. |
| PMI | $0 once LTV reaches 78% | Persisting indefinitely with low equity | PMI usually drops automatically when loan balance hits 78% of original value, and can be requested at 80%. |
How to run a mortgage analysis
- 1
Enter purchase price and down payment
Use the actual list price and the cash you can put down. The calculator computes the loan amount automatically.
- 2
Set interest rate and loan term
Use a current quote from a lender. 30-year fixed is the most common. 15- and 20-year terms reduce total interest but raise the monthly payment.
- 3
Add taxes, insurance, HOA, and PMI
Property taxes are usually 1.0% to 1.5% of price annually. Insurance is roughly $1,000 to $2,000 per year. PMI applies if down payment is under 20%.
- 4
Read the snapshot and amortization
Review your full PITI plus HOA payment, loan-to-value, total interest, and the year-by-year amortization summary.
The math behind the result
Core formulas
- Loan amount = purchase price - down payment.
- Principal and interest = standard fixed-rate mortgage payment formula.
- PMI = annual PMI rate x loan balance / 12, applied when down payment is below 20%.
- Total monthly payment (PITI + HOA) = principal + interest + taxes + insurance + HOA + PMI.
- Loan-to-value (LTV) = loan amount / purchase price.
- Total interest = (monthly payment x months) - loan amount.
Expert takeaways
- A mortgage calculator only matters when it separates principal and interest from taxes, insurance, and HOA dues. Otherwise you under-state the real monthly cost.
- When down payment is below 20%, lenders charge PMI, which usually adds 0.5% to 1.5% of the loan annually until LTV drops to 78%.
- Loan-to-value matters for risk. Higher leverage can boost returns but leaves less cushion for vacancy or rate shocks.
- For a rental, always feed the mortgage payment back into a cash-flow calculator. PITI alone does not tell you whether a deal works.
Key terms in plain English
- PITI
- Principal, interest, taxes, insurance.
- PITI is the standard way to describe a monthly mortgage payment: principal, interest, property taxes, and homeowners insurance. Adding HOA dues and PMI gives a full picture of the monthly housing cost.
- PMI
- Private mortgage insurance for low-down-payment loans.
- Private mortgage insurance protects the lender when down payment is below 20%. It typically costs 0.5% to 1.5% of the loan amount per year and drops off automatically when the loan balance reaches 78% of the original value.
- Loan-to-value
- Loan / purchase price.
- Loan-to-value compares your loan size to the price of the property. Lenders use it to price loans and decide whether to require PMI. Lower LTV means more equity cushion if values fall.
- Amortization
- How payments split between principal and interest.
- Amortization describes the schedule that breaks each monthly payment into principal and interest. Early payments are mostly interest, while later payments are mostly principal. Amortization tables show this year-by-year.
- APR
- Annual percentage rate.
- APR includes interest plus most loan fees, expressed as an annual percentage. APR is usually slightly higher than the note rate and is more useful when comparing loans with different fees.
People also ask
- How is a mortgage payment calculated?
- A fixed-rate mortgage payment is calculated with a standard amortization formula using the loan amount, the monthly interest rate, and the total number of payments. Property taxes, insurance, HOA dues, and PMI are added on top to get the full monthly housing cost.
- What is PITI on a mortgage?
- PITI stands for principal, interest, taxes, and insurance. It is the standard way lenders describe a complete monthly mortgage payment. Adding HOA dues and PMI when applicable gives a full picture of the monthly cost of owning the home.
- When is PMI required?
- Lenders typically require private mortgage insurance when down payment on a conventional loan is less than 20%. PMI usually drops off automatically when the loan balance reaches 78% of the original purchase price, and you can often request removal at 80%.
- How much should I put down on an investment property?
- Conventional investment-property loans usually require 20% to 25% down, and DSCR loans often want 20% to 30%. Larger down payments can reduce rate, eliminate PMI, and improve cash-on-cash return, but they also tie up more cash that could go toward another property.
- Should I choose a 15-year or 30-year mortgage?
- A 15-year mortgage has higher payments but pays off faster and saves a lot on interest. A 30-year mortgage has lower payments and stronger cash flow, which most rental investors prefer. The 30-year is also more flexible if rents soften or expenses rise.
- What is the total interest on a mortgage?
- Total interest is the difference between all the payments over the life of the loan and the original loan amount. On a 30-year, 6.75% mortgage of $240,000, total interest is roughly $320,000, which means you pay back more in interest than the original loan.
- Does this calculator estimate property taxes and insurance?
- You enter monthly property taxes and insurance directly. A common starting point is 1.0% to 1.5% of purchase price annually for taxes and $1,000 to $2,000 per year for insurance, but real values vary by state and county. Use a quote when you have one.
Compare your result
Want real estate exposure without buying the whole property?
Lofty lets investors browse fractional U.S. rental properties, compare listed assumptions, and start with a smaller minimum than a traditional down payment.
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