The total monthly number above is four things added together: principal & interest (P&I) on the loan itself, plus your property tax and homeowners insurance divided into monthly amounts. Of those four, P&I is usually the biggest by far, and it depends on just three numbers — how much you're actually borrowing (home price minus down payment), the interest rate, and the term. Tax and insurance don't change with your loan terms, which is why the two levers below (down payment and term) matter so much for the P&I portion specifically.
Take the calculator's own default numbers: a $450,000 home at 6.5% APR over 30 years, with $5,400/yr property tax and $1,800/yr insurance. Here's the same home at three different down payments:
| Down payment | Loan amount | Monthly P&I | Total interest (30yr) |
|---|---|---|---|
| 3.5% ($15,750) | $434,250 | $2,744.76 | $553,861.94 |
| 10% ($45,000) | $405,000 | $2,559.88 | $516,555.18 |
| 20% ($90,000) | $360,000 | $2,275.44 | $459,160.16 |
Going from 3.5% down to 20% down doesn't just lower the monthly payment by about $469 — it also cuts nearly $95,000 off the total interest paid over the life of the loan, because a smaller loan amount accrues less interest at every single payment. It's also worth knowing that most lenders require private mortgage insurance (PMI) on conventional loans with less than 20% down, which this calculator doesn't model — see the FAQ below.
On the same $360,000 loan (the 20%-down scenario above), the term you choose swings the numbers even harder than the down payment did:
| Term | Monthly P&I | Total interest |
|---|---|---|
| 15 years | $3,135.99 | $204,477.57 |
| 20 years | $2,684.06 | $284,175.19 |
| 30 years | $2,275.44 | $459,160.16 |
A 15-year term costs about $860 more per month than a 30-year term on the same loan — but it saves roughly $254,700 in total interest. Whether that trade makes sense depends entirely on whether the higher payment fits your budget; there's no universally "right" answer, which is why it's worth plugging in your own numbers above rather than relying on a rule of thumb.
Principal and interest, plus your entered property tax and homeowners insurance, divided into monthly amounts. It doesn't include PMI, HOA dues, or closing costs.
Interest compounds over a long term — on a 30-year mortgage, it's common for total interest to approach or exceed the original loan amount, especially at higher rates.
A larger down payment, a lower rate, or a longer term will all reduce it — try adjusting each field to see the effect immediately.