How much down payment do I need?

The minimum down payment depends on the loan type. Conventional loans often require 3-20%. FHA loans require 3.5% with a 580+ credit score. VA loans (for veterans) and USDA loans can require 0% down. Putting down 20% eliminates private mortgage insurance (PMI).

Should I choose a 15-year or 30-year mortgage?

A 30-year mortgage gives you lower monthly payments but you pay significantly more interest over time. A 15-year mortgage has higher monthly payments but you build equity faster and pay far less in total interest. If you can comfortably afford the higher payment, a 15-year loan saves you tens of thousands of dollars.

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Mortgage Calculator

Q: What is a good mortgage interest rate?

A good mortgage rate depends on the current market, your credit score, and loan type. As of 2026, rates on 30-year fixed mortgages generally range from the mid-6% to 7%+ range. Borrowers with credit scores above 740 typically qualify for the best available rates.

Q: What is an amortization schedule?

An amortization schedule shows how each mortgage payment is split between principal (reducing your loan balance) and interest. In the early years of a mortgage, most of your payment goes to interest. Over time, more goes to principal. The schedule shows this breakdown for every payment over the life of the loan.

Monthly payment, total interest, and full amortization schedule — know your numbers before you sign anything.

Quick reference: On a $300,000 home with 20% down at 6.5% interest over 30 years, your monthly payment is approximately $1,517. Over the life of the loan, you'd pay roughly $306,000 in interest on top of the $240,000 principal. Use the calculator below to run your own numbers.

Home Price ($)

Down Payment ($)

Annual Interest Rate (%)

Loan Term (Years)

Monthly Payment

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Enter values and calculate

Total Interest Paid

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Total Cost of Loan

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Loan amount: —

How Mortgage Payments Are Calculated

Your monthly mortgage payment is determined by four things: the loan amount (home price minus down payment), the interest rate, the loan term, and the amortization formula. The formula used by every lender and calculator is:

M = P × [r(1+r)^n] / [(1+r)^n – 1]

Where M is your monthly payment, P is the loan principal, r is the monthly interest rate (annual rate divided by 12), and n is the total number of payments. This formula ensures that each payment covers the interest due for that month plus a portion of the principal — so your balance decreases with every payment.

Key Terms Every Homebuyer Should Know

Principal

The loan balance

The amount you actually borrowed. Every payment chips away at this.

Interest

The lender's fee

What you pay to borrow the money. Expressed as an annual percentage rate.

Amortization

Payment schedule

How payments shift from mostly interest (early years) to mostly principal (later years).

PMI

Private Mortgage Insurance

Required on conventional loans when down payment is below 20%. Typically 0.5–1.5% of the loan per year.

Escrow

Tax & insurance fund

Many lenders collect property taxes and homeowner's insurance monthly, then pay them on your behalf.

Equity

Your ownership stake

The difference between what your home is worth and what you owe. Grows as you pay down principal.

15-Year vs. 30-Year Mortgage — Which is Better?

This is one of the most common questions homebuyers face, and the honest answer is: it depends on your financial situation and priorities. Here's the real breakdown.

30-Year Mortgage

A 30-year fixed mortgage spreads your payments over a longer period, resulting in a lower monthly payment. This gives you more flexibility in your monthly budget. However, because you're borrowing money for longer, you pay significantly more in interest over time. On a $240,000 loan at 6.5%, you'd pay roughly $306,000 in interest over 30 years.

15-Year Mortgage

A 15-year mortgage typically comes with a lower interest rate (often 0.5–0.75% lower than 30-year rates) and you pay it off in half the time. The monthly payment is higher, but your total interest cost is dramatically less. On the same $240,000 loan, a 15-year at 5.75% would cost roughly $116,000 in total interest — saving you around $190,000 compared to the 30-year option.

How Much Down Payment Do You Actually Need?

The conventional wisdom is 20% down, but that's not a hard requirement. Here's what different down payment amounts actually mean:

A 3-5% down payment is available on many conventional loans and is required for FHA loans (3.5% minimum with a 580+ credit score). The trade-off is private mortgage insurance (PMI), which adds to your monthly payment until you reach 20% equity.

A 10% down payment reduces your loan balance and your PMI cost, but doesn't eliminate it on a conventional loan.

A 20% down payment eliminates PMI entirely and often gets you a slightly better interest rate. If you can reach 20%, it's generally worth it.

Veterans may qualify for a VA loan with 0% down, and USDA loans offer 0% down for eligible rural and suburban properties. These programs can make homeownership accessible without a large down payment.

Helpful Resources

For more guidance on mortgages and homebuying, these government and nonprofit resources are reliable starting points:

Consumer Financial Protection Bureau HUD — Buying a Home Freddie Mac Home Buyer Resources IRS — Mortgage Interest Deduction

Frequently Asked Questions

What credit score do I need to get a mortgage?

Most conventional loans require a minimum credit score of 620. FHA loans accept scores as low as 580 (with 3.5% down) or 500 (with 10% down). VA loans don't have a set minimum but lenders typically look for 620+. To get the best interest rates, a score of 740 or above is ideal.

What is a good mortgage interest rate?

Rates change with market conditions. As of 2026, 30-year fixed rates generally range from the mid-6% to 7%+ range depending on your credit profile. The best way to find your rate is to get quotes from at least three different lenders and compare the APR, not just the interest rate.

Does this calculator include taxes and insurance?

No — this calculator shows the principal and interest (P&I) portion of your payment only. Your actual monthly payment will be higher once you add property taxes, homeowner's insurance, and PMI (if applicable). Property taxes vary significantly by location; your lender can provide a full payment estimate that includes all costs.

What is an amortization schedule?

An amortization schedule shows how each of your mortgage payments is split between principal and interest. In the early years of your loan, most of each payment goes toward interest. As the loan matures, more goes to principal. The schedule above shows the first 24 months — notice how the interest portion decreases and the principal portion increases over time.

Can I pay off my mortgage early?

Yes, and it can save you a significant amount in interest. Making even one extra principal payment per year can shave years off a 30-year mortgage. Check your loan terms for any prepayment penalties — most modern mortgages don't have them, but it's worth confirming before making extra payments.