How to Calculate a Mortgage Payment: Formula and Examples
Learn how to calculate your monthly mortgage payment with the French method formula, real examples and a free calculator.
Knowing how to calculate a monthly mortgage payment helps you plan your budget and compare offers. Most loans use the French method, with a constant payment over the life of the loan. This guide walks you through it step by step.
1 The constant payment formula
Payment = C × i × (1+i)^n ÷ ((1+i)^n − 1), where C is the loan principal, i the monthly rate (annual rate ÷ 12 ÷ 100) and n the total number of payments (years × 12).
2 Basic example
A €150,000 mortgage at 3% for 30 years: i = 0.03/12 and n = 360. The resulting payment is about €632 per month.
3 Total interest
Multiply the payment by the number of payments to get the total paid and subtract the principal: in the example above, about €77,000 in interest over 30 years.
4 Use the calculator
Enter the principal, annual interest and years in the mortgage calculator to see your monthly payment, total interest and the full year-by-year amortization schedule.
Try it with our free tool
Mortgage Calculator
Use the tool