What is included in a mortgage payment?
A typical mortgage payment includes principal and interest. Depending on the property and loan, the total monthly housing payment may also include property taxes, homeowners insurance, homeowners association fees, and private mortgage insurance.
The amount you pay depends on factors such as the loan amount, interest rate, repayment term, property taxes, insurance costs, and other applicable expenses.
Why the interest rate matters
The interest rate has a significant effect on the cost of a mortgage. A higher rate generally increases both the monthly principal-and-interest payment and the total interest paid over the life of the loan.
Even a relatively small difference in the interest rate can make a substantial difference over a 15- or 30-year mortgage.
Estimate your payment
Using a mortgage calculator allows you to combine the loan amount, interest rate, term, taxes, insurance, and other optional costs into one estimated monthly payment.