30 Year Fixed Mortgage Calculator

Mortgage Payment Formula:

\[ Payment = P \times \frac{r(1 + r)^n}{(1 + r)^n - 1} \]

Monthly Payment:

Total Payment (30 years):

Total Interest:

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1. What is a 30-Year Fixed Mortgage?

A 30-year fixed-rate mortgage is a home loan with an interest rate that remains constant for the entire 30-year term. It features equal monthly payments that are calculated to pay off the loan completely by the end of the term.

2. How Does the Calculator Work?

The calculator uses the standard mortgage payment formula:

\[ Payment = P \times \frac{r(1 + r)^n}{(1 + r)^n - 1} \]

Where:

$ P $ — Principal loan amount (USD)
$ r $ — Monthly interest rate (annual rate ÷ 12, in decimal)
$ n $ — Total number of payments (30 years × 12 = 360 months)
$ Payment $ — Monthly payment amount (USD)

Explanation: The formula calculates the fixed monthly payment required to fully amortize the loan over its term, accounting for both principal and interest.

3. Understanding Mortgage Payments

Details: Each payment consists of both principal (the loan amount) and interest (the cost of borrowing). Early in the loan, most of the payment goes toward interest. Over time, more of each payment is applied to the principal.

4. Using the Calculator

Tips: Enter the total loan amount and annual interest rate. The calculator will show your estimated monthly payment, total payment over 30 years, and total interest paid.

5. Frequently Asked Questions (FAQ)

Q1: What are the advantages of a 30-year fixed mortgage?
A: Lower monthly payments compared to shorter terms, predictable payments, and easier qualification due to lower payments.

Q2: What are the disadvantages?
A: You'll pay more interest over the life of the loan compared to shorter-term mortgages, and it takes longer to build equity.

Q3: How does the interest rate affect payments?
A: Even small rate changes significantly impact monthly payments and total interest. A 1% rate increase on a $300,000 loan adds about $180 to monthly payments.

Q4: Should I pay extra on my mortgage?
A: Making extra principal payments can save thousands in interest and shorten the loan term, but consider other financial priorities first.

Q5: What costs aren't included in this calculation?
A: This shows principal and interest only. Actual payments may include property taxes, insurance, and possibly PMI (private mortgage insurance).