# What the mortgage calculator leaves out

The large number is the monthly principal and interest on a fixed-rate loan. It is not the check you write to a lender. A real monthly payment usually adds property tax, homeowner's insurance, and sometimes mortgage insurance. This page has no fields for those.

## The formula, in plain terms

The loan amount is the home price minus the down payment. A down payment larger than the price is treated as a zero loan. The monthly rate is the annual rate divided by 12. The number of months is the years times 12. The term field allows 1 to 40 years. The default is 30.

The payment is the standard fixed-rate formula. If the annual rate is 0, the payment is simply the loan divided by the number of months. The monthly figure is rounded to cents. Total interest and total paid on the detail line are rounded to the nearest dollar. There is no amortization table, no extra principal payment, and no adjustable rate.

## The default example

The fields start at a home price of $350,000, a down payment of $70,000, an annual rate of 6.5 percent, and 30 years. The loan is $280,000, which is exactly 20 percent down. The monthly principal and interest is $1,769.79. Total interest over 360 payments is about $357,125. Total paid is about $637,125.

Change only the rate if you want to see the interest effect. The same $280,000 for 30 years costs less per month at 5.5 percent and more at 7.5 percent. The page does not tell you which rate you qualify for, and it does not look up today's mortgage rate.

## What is missing on purpose

- Property tax and homeowner's insurance. A lender's monthly amount is usually higher because of escrow.
- Mortgage insurance. If the down payment is under 20 percent, many lenders add it. The math here still runs. The premium is not estimated.
- Points. A quote of 6.5 percent with points is not the same as typing 6.5 here, because points are paid up front and this page has no field for them.
- Interest-only, adjustable, and balloon loans. This formula does not describe them.
- Currency. The inputs are labeled in dollars and the result is prefixed with $. You can type another currency's numbers, but they are not converted, and the dollar sign remains.

## Not advice

This is arithmetic for a fixed-rate loan, for information only. It is not a loan offer, not a quote, and not financial advice. Actual terms differ. A qualified adviser or the lender's own disclosure is the document that matters for a personal decision.

Use the page to compare two rates or two terms on the same loan amount. Write down the principal-and-interest figure, then add the tax and insurance numbers from the listing or the lender's estimate yourself. The sum of those is closer to a monthly housing cost than the number on this page alone. The page will not do that addition, because those inputs are not there.

A 15-year term on the same $280,000 raises the monthly principal and interest and cuts the total interest. That tradeoff is what the formula is for. It still ignores mortgage insurance, HOA dues, and any upfront points. If the offer in front of you includes those, this calculator is only one line of the comparison.

## Questions

### Does the payment include tax and insurance?

No. It is principal and interest only. A mortgage statement is usually higher.

### What if my down payment is under 20 percent?

The math still runs. Many lenders then add mortgage insurance. This page does not estimate that premium.

### Why do the interest totals not match to the cent?

The monthly figure uses cents. Total interest and total paid on the detail line are rounded to the nearest dollar.

Tool: https://pctoolsonline.com/tools/mortgage-calculator.html