Mortgage calculator

Estimate the monthly payment of a mortgage with the standard French amortization formula. Useful to compare term and rate scenarios before requesting a real quote from your bank.

A mortgage is the largest financial decision most people sign in their lifetime. The monthly payment is just one part of the commitment: there's down payment, fees, insurance, notary costs, accumulated interest, and assumptions about your future income. This calculator works with the math of amortization (what banks use internally) and gives you an illustrative number. It does not query rates in real time, does not run a credit evaluation, and is not an offer. It is the starting point so you can walk into the bank with a concrete question, not with uncertainty.

Financial disclaimerIndicative result — not professional financial advice. Consult a specialist before making investment or credit decisions.

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Calculator · Mortgage credit

What it calculates

The estimated monthly payment of a mortgage under French amortization: constant monthly payment with decreasing interest portion and increasing principal portion. It also shows total amount paid by end of term and accumulated interest over the initial principal.

Who it's for

For people evaluating buying a home, comparing preliminary mortgage offers, or deciding between terms (15 vs 20 vs 30 years). Also useful for real estate advisors who need to give clients a quick estimate before channeling them to the bank.

When to use it

Before visiting a bank, to anticipate the monthly payment range. When comparing two scenarios (shorter term with higher payment vs longer term with lower payment but more total interest). When an advisor pre-qualifies you: the calculator helps you understand whether the payment fits your budget before accepting.

When NOT to use it

Don't use it as a substitute for the formal bank offer. It does not include opening commission, mandatory insurance (life, damages, unemployment), notary fees, transfer tax according to jurisdiction, or the real rate the bank will assign you after evaluating your profile. It is not legal advice on the mortgage contract; any binding clause must be reviewed by a lawyer.

What data it needs

  • Loan amount

    The principal you're financing. It's the home price minus the down payment. If the home costs $2,500,000 and your down payment is $500,000, the loan amount is $2,000,000.

  • Annual rate

    The nominal annual interest rate. Declare it as a percentage (e.g., 9.5 for 9.5%). The calculator divides by 12 for the monthly rate. Real rates vary by country, term, and profile — the calculator does not query them automatically.

  • Term

    Years over which you'll pay. Short terms (15 years) reduce total interest but raise the monthly payment. Long terms (25-30 years) lower the payment but you pay more in interest at the end.

  • Monthly income (optional)

    Your gross monthly income. Allows calculating debt-to-income ratio (payment ÷ income). The common rule is the payment shouldn't exceed 30-35% of gross income, but each bank has its own policy.

Formula

French amortization system: M = C × i / (1 − (1 + i)^(−n)), where M is the monthly payment, C the loan principal, i the monthly rate (annual rate ÷ 12), and n the total number of payments (years × 12). Total paid at end of term is M × n; total interest is M × n − C. This is the standard formula banks use for constant amortization.

How to interpret the result

The monthly payment must fit your budget without choking it. If the estimated payment already exceeds 35% of your income, the bank will likely reject you or offer a smaller amount. Always compare total paid at end of term: the difference between 20 and 30 years can be very significant in accumulated interest. And remember: the real monthly payment includes insurance and sometimes administration fees this calculator doesn't consider.

How this simulator was reviewed

What you'll see, what it prevents, and where you shouldn't trust it

Hypothetical caseCase A

A couple comparing 15-year vs 25-year terms on the same home

A couple considers a $1,800,000 MXN loan for a $2,250,000 home (with $450,000 down payment). At 10.5% annual rate, the calculator shows: at 15 years, monthly payment of $19,898 and total paid of $3,581,640 (interest $1,781,640). At 25 years, monthly payment of $17,005 and total paid of $5,101,500 (interest $3,301,500). Decision: the 15-year term costs $2,893 more per month but saves $1,519,860 in total interest. If income allows it, the short term is clearly better in absolute cost.

Illustrative figures. Does not represent a real company or an investment recommendation.

Hypothetical caseCase B

A buyer who finds the payment exceeds their capacity

A buyer with $45,000 MXN/month gross income sees a $2,000,000 home financed at 100% (uncommon but exists). Rate 11%, term 20 years. Estimated payment: $20,646. Payment-to-income ratio: 45.9% — well above the 30-35% most banks accept. The calculator indicates they need to reduce the loan amount (more down payment), accept a longer term, or wait until income rises. Many banks would reject this application directly; seeing it beforehand avoids the wear of the rejection.

Illustrative figures. Does not represent a real company or an investment recommendation.

Common mistakes

  • Looking only at the monthly payment. A low payment over 30 years can pay 2-3 times the loan value in total interest. Always compare total paid and monthly payment together before deciding.
  • Ignoring associated costs. Notary, transfer tax/VAT, registration, opening commission, and insurance can add 5-12% of home value — and must be paid at signing, in addition to the down payment.
  • Using advertised rate. Advertised rates are the floor for excellent profiles. The rate your bank offers after evaluating your history may be 1-2 points higher. Always model with a conservative scenario.
  • Confusing pre-approval with approval. A pre-approval says the bank is willing to talk to you. Final approval comes after appraisal, income verification, and complete credit evaluation — and may change the terms.

Model limitations

  • Does not query bank rates in real time. You declare the rate; the model doesn't know what rate is current in your market right now.
  • Does not replace credit evaluation. The bank verifies score, history, income, employment tenure, and debt-to-income ratio; no calculator result guarantees approval.
  • Does not include commissions, insurance, or associated costs. The formula is pure French amortization on declared principal.
  • Does not model variable rate. If your mortgage has a rate that changes annually (mixed or variable indexed), the real payment will change throughout the term and this model does not project it.

When NOT to use this simulator

If you're going to sign a mortgage contract in the next few days, don't decide with this calculator as the only piece of evidence. Request the formal bank offer with all items broken down (principal, interest, fees, insurance, associated costs), review the contract with a lawyer or notary, and compare against at least 2 more offers before signing. The mortgage will accompany you 15-30 years; small costs become significant over that span.

Frequently asked questions — mortgage

1Does this calculator tell me the real payment I'll make?
No. It gives you an estimate based on the standard French amortization formula. The real payment includes mandatory insurance (life, damages, sometimes unemployment), administration or disbursement commission and, in some countries, other items. The formal offer from a bank is always the only binding figure.
2How do I choose the term?
Shorter term = higher payment + less total interest. Longer term = lower payment + more total interest. If your priority is paying off the home as soon as possible and your income allows it, short terms are better. If your priority is monthly flexibility, a long term gives you margin but adds total cost. Always compare both scenarios in the calculator before signing.
3What rate should I use if I don't have an offer yet?
Use a conservative market reference rate (a bit above the ones published on official sites). Advertised rates are the floor for borrowers with strong history; your real rate may be 1-2 points higher if your score is average. To see the range, try the calculator with two rates (the low one and a higher one) to understand the worst case.
4Why doesn't the payment include the down payment?
The down payment is what you pay out of pocket at signing (typically 10-30% of home value). The mortgage credit is the rest, and the monthly payment only amortizes that rest. To include the down payment in your total cost calculation, add it to the total paid at end of term: down payment + (payment × months).
5What if I want to make extra payments?
Extra principal payments reduce the term or the monthly payment (depending on what you negotiate with the bank). This calculator does not project the effect of extra payments — for that analysis you need a custom amortization sheet or the bank's simulator. The important thing: review that your contract doesn't penalize prepayment, because some banks do charge a fee.
6Does it work for reverse mortgages or bridge loans?
No. This calculator assumes standard French amortization (constant payment with principal + interest). Reverse mortgages, bridge loans, mixed mortgages, or those that adjust rate annually require different models. For those products consult directly with the bank that offers them.
7Does it work for Mexico, Spain, Colombia, and other countries?
The amortization formula is universal. What changes between countries are typical rates, currency, and associated costs (notary, transfer tax in Spain, registration rights in Mexico, etc.). You declare the rate that applies to your country; the calculator gives you the result in the currency you have selected in the toolbar.

Financial notice

The result is an illustrative estimate based on the data entered. It does not constitute financial, tax, accounting, or legal advice, nor a credit offer. For a real credit evaluation you must visit a certified financial institution in your jurisdiction.

Simúlalo is not affiliated with, sponsored by, or endorsed by commercial banks, Banco de España, Banxico, CONDUSEF, CNBV, AEAT, SAT, Banco de la República (Colombia), or any institution mentioned in the content.

Editorial review

Reviewed by the Simúlalo editorial team

This simulator was reviewed by the people listed below before being published. The review covers the declared formula, the model's assumptions, the explicit limitations, and the absence of unsupported financial claims.

They are part of the Simúlalo editorial team, focused on building financial tools that are clear, educational, and easy to interpret.

Last updated: We update this page when the methodology, sources used, or simulator structure change.

This tool uses standard financial formulas and user-supplied data. To explain concepts like rates, credit, risk, or cash flow we consult public and official sources (Banxico, SAT, CONDUSEF, CNBV, Banco de España, IFRS, BIS, among others). Simúlalo is not affiliated with, sponsored by, or endorsed by these institutions.

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