Mortgage Interest Calculator
Estimate your monthly mortgage payment, total interest paid and total repayment based on your loan amount, interest rate and term.
Overview
This mortgage interest calculator helps you estimate the cost of borrowing for a home loan. Enter your loan amount, annual interest rate, loan term and repayment type to see the monthly payment, total interest and overall repayment amount.
How it works
For principal and interest mortgages, the calculator uses the standard amortization method to spread repayment of both the loan balance and interest across equal monthly payments over the selected term. For interest-only mortgages, it calculates the monthly interest charge based on the current loan balance and interest rate. Total interest and total repayment are then estimated from those monthly amounts over the chosen term.
How to use this calculator
- 1Enter the mortgage loan amount you want to borrow.
- 2Add the annual interest rate offered by the lender.
- 3Choose the mortgage term in years.
- 4Select principal and interest or interest only.
- 5Review the estimated monthly payment and total interest results.
Example Calculation
Loan amount
$300,000
Annual interest rate
7%
Loan term
30
Repayment type
principalAndInterest
Monthly payment
$1,896
For a $300,000 mortgage at 6.5% over 30 years, the estimated monthly principal and interest payment is about $1,896, with total interest of about $382,560 and total repayment of about $682,560.
Frequently asked questions
What does this mortgage interest calculator estimate?
It estimates your monthly mortgage payment, total interest paid and total amount repaid based on the loan amount, interest rate and term.
Does this calculator include property taxes or insurance?
No. It focuses on mortgage principal and interest only. Taxes, insurance, fees and other housing costs are not included.
What is the difference between principal and interest and interest-only?
Principal and interest payments reduce the loan balance over time. Interest-only payments cover interest charges only, so the original loan balance usually remains unchanged during that period.
Why is the total interest so high on longer terms?
A longer mortgage term usually lowers the monthly payment, but interest is charged for more months, which can increase the total interest paid.
Can I use this calculator for fixed and variable rates?
Yes, but the estimate assumes the rate entered stays the same for the full term. If your rate changes, actual payments and interest will differ.
How can I reduce the total interest on my mortgage?
You may reduce total interest by borrowing less, choosing a shorter term, securing a lower interest rate or making extra repayments if your lender allows it.
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Assumptions and warnings
Assumptions
- Results are estimates based on a fixed interest rate over the full term.
- Monthly payments are assumed for all calculations.
- Principal and interest results use a standard amortizing mortgage formula.
- Interest-only results assume the original loan balance is not reduced during the selected term.
- Fees, taxes, insurance, redraws and offset account effects are not included.
Warnings
- This calculator provides an estimate only and is not financial advice.
- Actual mortgage costs may vary due to fees, changing rates, lender criteria and repayment structure.
- Speak to a qualified professional before making major borrowing decisions.