Thinking about buying a home and want to know what your monthly payment will be? Our free mortgage calculator gives you an instant breakdown of your monthly payment, total interest paid, and full amortisation schedule.
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How Does a US Mortgage Work?
A mortgage is a loan from a bank or lender to finance a home purchase. Each monthly payment covers two components:
- Principal: the portion of the loan balance you're paying down
- Interest: the lender's fee for providing the loan
In the early years, most of your payment goes toward interest. Over time, the balance shifts — you pay more principal and less interest each month. This is called amortisation.
Mortgage Payment Formula
M = P × [r(1+r)^n] ÷ [(1+r)^n − 1]
Where:
- M = monthly payment
- P = principal loan amount
- r = monthly interest rate (annual rate ÷ 12)
- n = number of payments (years × 12)
Skip the math — use our free Mortgage Calculator for an instant result.
Real Examples for 2026
Estimated average rate: 6.8% on a 30-year fixed mortgage
| Loan Amount | Term | Monthly Payment | Total Interest Paid |
|---|---|---|---|
| $200,000 | 30 years | $1,303 | $268,900 |
| $300,000 | 30 years | $1,955 | $403,800 |
| $400,000 | 15 years | $3,555 | $239,900 |
| $500,000 | 30 years | $3,258 | $672,900 |
2026 US Mortgage Rates
After the rate spike of 2023-2024, rates have begun to ease but remain elevated by historical standards:
| Loan Type | Estimated Rate (Good Credit) |
|---|---|
| 30-year fixed | ~6.5–7.0% |
| 15-year fixed | ~6.0–6.5% |
| 5/1 ARM | ~6.0–6.5% |
Always compare rates from multiple lenders — even a 0.5% difference saves tens of thousands over the life of a loan.