How this calculation works
This calculator determines monthly principal and interest payments using standard fixed-rate amortization formulas. Escrow estimates reflect annual property taxes, hazard insurance, and optional homeowners association dues divided into monthly increments.
Note interest rate vs APR: The note interest rate is the contractual rate used to calculate your monthly principal and interest payment. The Annual Percentage Rate (APR) reflects the broader cost of credit, including prepaid finance charges, closing costs, and discount points over the life of the loan. When no upfront financing fees or points are paid, the APR equals the note rate. See our Mortgage Points Calculator to evaluate loans with discount points.
Private Mortgage Insurance (PMI) under CFPB rules: Under the federal Homeowners Protection Act of 1998 (12 U.S.C. 4901 et seq.):
- Borrower-requested cancellation at 80% LTV: You have the right to submit a written request to cancel PMI once your mortgage principal balance reaches 80% of the original home value. Requirements include a good payment history (no 30-day late payments in the past 12 months, no 60-day late payments in the past 24 months), being current on payments, no subordinate liens (such as a second mortgage), and evidence that the home value has not declined.
- Automatic termination at 78% LTV: Loan servicers are required by federal law to automatically terminate PMI on the date your principal balance is first scheduled to reach 78% of the original value, provided your payments are current. No appraisal can be required for scheduled automatic termination.
- Midpoint final termination: If PMI has not been canceled earlier, the servicer must terminate PMI the month after your loan reaches the midpoint of its amortization schedule (month 181 on a 30-year mortgage), provided payments are current.
- Loan-type exclusions: These rights apply to conventional residential mortgages. FHA loans require Mortgage Insurance Premiums (MIP), which for down payments under 10% persist for the full life of the loan. VA loans charge an upfront funding fee instead of monthly insurance. USDA loans charge annual guarantee fees. Lender-paid mortgage insurance (LPMI) is built into a higher note interest rate and does not cancel.
Disclaimer: A planning estimate based on your inputs and the assumptions shown. Actual costs and eligibility may differ. Not an offer of credit, pre-approval, loan commitment, or legal advice. Lenders have specific underwriting, documentation, and property appraisal requirements.