What goes into a mortgage payment
A mortgage payment has up to four parts, often called PITI: principal, interest, taxes and insurance. Principal and interest come from the loan amount, rate and term through the standard amortization formula. Property tax and homeowners insurance are usually collected monthly into an escrow account and paid by the lender when due. Homeowners association dues are paid separately but belong in a monthly budget just the same.
Worked example (pre-filled). A $350,000 home with 10% down ($35,000.00) leaves a $315,000.00 loan at 90.0% loan-to-value. At 6.25% over 30 years the principal-and-interest payment is $1,939.51. Adding $3,600 a year of property tax ($300.00 a month) and $1,800 of insurance ($150.00) brings the monthly total to $2,389.51. Over 30 years the interest alone comes to $383,222.81.
The yearly table shows why early payments feel slow: in year one most of each payment is interest, and the balance falls by only a few thousand dollars. A shorter term raises the payment but cuts total interest sharply; try 15 years in the term box to compare. Mortgage insurance (PMI), which lenders often require below 20% down, is not modelled because its cost depends on the lender, credit score and loan type; add it to the HOA field if you have a quote. This page computes; it does not recommend a loan, lender, investment or tax position.
Property tax in Georgia is set by county and city millage rates on assessed value, so the annual figure should come from the county tax assessor or the listing. The debt-to-income calculator compares this payment with monthly income.
Formula and assumptions
P&I = loan × r ÷ (1 − (1 + r)−n), r = APR ÷ 12, n = years × 12
total monthly = P&I + tax ÷ 12 + insurance ÷ 12 + HOA
- Fixed rate, monthly compounding, no points, fees, PMI or escrow cushion.
- Taxes and insurance are assumed constant; in practice they change yearly.
Frequently asked questions
What is the monthly payment on a $315,000 mortgage at 6.25% for 30 years?
$1,939.51 in principal and interest. Taxes, insurance and dues are added on top.
What does PITI mean?
Principal, interest, taxes and insurance: the four parts of a typical monthly mortgage payment when the lender escrows tax and insurance.
How much does a 15-year term save?
On $315,000 at 6.25%, the 15-year payment is $2,700.88 versus $1,939.51, but total interest drops from about $383,223 to about $171,159.
Is PMI included?
No. Private mortgage insurance depends on the lender and borrower. If you have a quote, add the monthly amount to the HOA field.
Why does the balance fall so slowly at first?
Interest is charged on the full balance, so early payments are mostly interest. As the balance falls, more of each fixed payment goes to principal.
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- Georgia paycheck calculator: take-home pay after federal, FICA and Georgia tax
- Georgia income tax rate 2026
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Sources
This calculator gives general estimates from the figures you enter. It is not tax, legal, payroll or financial advice. See our disclaimer.