What is the difference between fixed payment and fixed principal?

Fixed payment (amortization) keeps your monthly payment the same throughout the loan term. Fixed principal means you pay a fixed principal amount each month plus decreasing interest, so your monthly payment decreases over time.

How is mortgage monthly payment calculated?

For fixed payment loans: M = P × r × (1+r)^n / [(1+r)^n - 1], where P is the loan principal, r is the monthly interest rate, and n is the total number of payments.

Does a shorter loan term save money?

Yes, shorter loan terms typically result in less total interest paid, though monthly payments will be higher. Use this calculator to compare different terms.

🏠 Mortgage Calculator

Calculate monthly payments with fixed payment or fixed principal methods

Repayment Method

Loan Amount (10k)

Annual Interest Rate (%)

Loan Term

Monthly Payment

$6,320.68

Loan Amount

$1,000,000.00

Total Payment

$2,275,444.88

Total Interest

$1,275,444.88

Payment Breakdown

Principal$1,000,000.00 (43.9%)

Interest$1,275,444.88 (56.1%)

Annual Payment Breakdown

PrincipalInterest

Amortization Schedule

Period	Payment	Principal	Interest	Balance
1	$6,320.68	$904.01	$5,416.67	$999,095.99
2	$6,320.68	$908.91	$5,411.77	$998,187.08
3	$6,320.68	$913.83	$5,406.85	$997,273.24
4	$6,320.68	$918.78	$5,401.90	$996,354.46
5	$6,320.68	$923.76	$5,396.92	$995,430.70
6	$6,320.68	$928.76	$5,391.92	$994,501.93
7	$6,320.68	$933.79	$5,386.89	$993,568.14
8	$6,320.68	$938.85	$5,381.83	$992,629.29
9	$6,320.68	$943.94	$5,376.74	$991,685.35
10	$6,320.68	$949.05	$5,371.63	$990,736.30
11	$6,320.68	$954.19	$5,366.49	$989,782.11
12	$6,320.68	$959.36	$5,361.32	$988,822.75
13	$6,320.68	$964.56	$5,356.12	$987,858.19
14	$6,320.68	$969.78	$5,350.90	$986,888.41
15	$6,320.68	$975.03	$5,345.65	$985,913.37
16	$6,320.68	$980.32	$5,340.36	$984,933.06
17	$6,320.68	$985.63	$5,335.05	$983,947.43
18	$6,320.68	$990.96	$5,329.72	$982,956.46
19	$6,320.68	$996.33	$5,324.35	$981,960.13
20	$6,320.68	$1,001.73	$5,318.95	$980,958.40
21	$6,320.68	$1,007.16	$5,313.52	$979,951.25
22	$6,320.68	$1,012.61	$5,308.07	$978,938.64
23	$6,320.68	$1,018.10	$5,302.58	$977,920.54
24	$6,320.68	$1,023.61	$5,297.07	$976,896.93
25	$6,320.68	$1,029.16	$5,291.53	$975,867.77
26	$6,320.68	$1,034.73	$5,285.95	$974,833.04
27	$6,320.68	$1,040.33	$5,280.35	$973,792.71
28	$6,320.68	$1,045.97	$5,274.71	$972,746.74
29	$6,320.68	$1,051.64	$5,269.04	$971,695.10
30	$6,320.68	$1,057.33	$5,263.35	$970,637.77
31	$6,320.68	$1,063.06	$5,257.62	$969,574.71
32	$6,320.68	$1,068.82	$5,251.86	$968,505.90
33	$6,320.68	$1,074.61	$5,246.07	$967,431.29
34	$6,320.68	$1,080.43	$5,240.25	$966,350.86
35	$6,320.68	$1,086.28	$5,234.40	$965,264.58
36	$6,320.68	$1,092.16	$5,228.52	$964,172.42

Showing first 36 of 360 periods

Mortgage Calculator Guide

This mortgage calculator supports monthly payment calculations for conventional fixed-rate, adjustable-rate, and combined mortgage types. You can freely switch between equal installment (fixed payment) and equal principal (declining payment) methods. Enter the loan amount, term, and interest rate to quickly get your monthly payment, total interest, total repayment, and a detailed amortization schedule.

Mortgage payment calculation is the most critical financial step in the homebuying decision. Accurately understanding your monthly payment helps you plan household finances and avoid overextending your budget. This tool also provides early repayment simulation to help you evaluate interest savings under different repayment strategies. Whether you're a first-time buyer or upgrading, you can compare multiple scenarios to find the loan plan that best fits your financial situation.

Fixed Payment vs Declining Payment Comparison

The core difference between the two repayment methods lies in how the monthly payment changes and the total interest paid:

[Fixed Payment (Equal Installment)] The monthly payment remains constant throughout the loan term. In the early payments, interest makes up a larger portion and principal a smaller portion; this gradually reverses over time. The advantage is predictable payments that make budgeting easier; the disadvantage is higher total interest. Best suited for buyers with stable incomes who want predictable payments, especially first-time homebuyers.

[Declining Payment (Equal Principal)] The monthly payment decreases each month, with the highest payment in the first month. More principal is paid off early, so total interest is significantly lower than fixed payment. The advantage is less total interest; the disadvantage is higher initial payments. Best suited for buyers with higher current incomes who want to minimize interest costs.

Example comparison for a $200,000 loan, 30-year term, 5% annual rate: - Fixed payment: Monthly payment ~$1,074 (constant), total interest ~$186,512 - Declining payment: First month ~$1,389, last month ~$558, total interest ~$150,667 - Interest difference: Declining payment saves about $35,845

Recommendation: If monthly payments exceed 40% of your income, choose fixed payment; if payments are comfortable and you want to save money, declining payment is better.

Mortgage Rates and Down Payment Policies

Current mortgage rates are typically based on benchmark rates set by central banks, with adjustments based on market conditions and borrower profile. Understanding rate composition and policy trends is crucial for homebuying decisions:

[Rate Composition] Your mortgage rate depends on factors including the central bank benchmark rate, your credit score, loan type, and down payment amount. A higher credit score and larger down payment generally qualify you for lower rates.

[First Home vs Second Home] First-time buyers typically receive more favorable rates than those purchasing a second home or investment property. The rate difference can be 0.5%-1.5% depending on the lender and local market conditions.

[Down Payment Requirements] First home down payments typically range from 3%-20% depending on the loan type and lender. Conventional loans often require 5%-20% down, while FHA loans may accept as little as 3.5%. A down payment below 20% usually requires Private Mortgage Insurance (PMI).

[Rate Trends] Monitor central bank policy and economic indicators for rate direction. Even small rate differences significantly impact total cost over a 30-year loan. A 0.5% rate difference on a $300,000 loan means about $30,000 more in total interest.

This calculator is for reference only. Calculation results do not constitute any legal basis or investment advice. Actual rates and amounts depend on lender policies and approval results.

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Mortgage Calculator Guide

This mortgage calculator helps you estimate your monthly payments and total interest for a home loan. Enter your loan amount, interest rate, and loan term to see a detailed breakdown including an amortization schedule.

The calculator supports two repayment methods: Fixed Payment (amortization) and Fixed Principal. Fixed Payment keeps your monthly payment constant throughout the loan term, while Fixed Principal decreases your monthly payment over time as the interest portion shrinks.

Repayment Methods Explained

Fixed Payment (Amortization): Your monthly payment stays the same for the entire loan term. In the early years, most of your payment goes toward interest; over time, more goes toward principal. This is the most common mortgage type worldwide.

Fixed Principal: You pay a fixed amount of principal each month plus interest on the remaining balance. Since the balance decreases each month, your total payment decreases over time. The first month's payment is the highest, and payments gradually decline.

Compare both methods using this calculator to see the difference in total interest paid and monthly payment patterns.

Mortgage Calculation Formulas

Fixed Payment Formula:
M = P × r × (1+r)^n / [(1+r)^n - 1]
Where: M = monthly payment, P = loan principal, r = monthly interest rate (annual rate ÷ 12), n = total number of payments
Total Interest = M × n - P

Fixed Principal Formula:
Month k payment = P/n + (P - P×(k-1)/n) × r
Where: P/n = fixed monthly principal, the second term is the interest for month k
First month payment is the highest; last month is the lowest
Total Interest = P × r × (n+1) / 2

Mortgage Calculation Examples

📋

Example 1: Fixed Payment Mortgage Loan: $1,000,000, Rate: 6.5%, Term: 30 years (360 payments) - Monthly payment: $6,320.68 (fixed for 30 years) - Total payment: $2,275,444.80 - Total interest: $1,275,444.80 Example 2: Same loan with Fixed Principal Loan: $1,000,000, Rate: 6.5%, Term: 30 years - First month payment: $7,638.89 - Last month payment: $2,793.98 - Total payment: $1,978,125.00 - Total interest: $978,125.00 - Difference: Fixed principal saves $297,319.80 in total interest compared to fixed payment

Important Notes

💡

1. The interest rate used is for reference only. Your actual rate depends on your credit score, down payment, lender, and market conditions. 2. This calculator does not include property tax, insurance, or HOA fees which may be part of your actual monthly housing cost. 3. Early payments may have slightly different amounts due to the timing of your first payment. 4. Some lenders may charge prepayment penalties for paying off your mortgage early. 5. Results are for informational purposes only and should not be considered financial advice.

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