Look at the detailed step-by-step procedure to calculate the monthly payments easily and quickly. Go through the below steps carefully.

- Let us know the details of a mortgage amount, interest rate, and mortgage terms.
- After that apply the formula and keep all the details in the formula.
- Then simplify it and you will get the monthly payments.

Now we will look into the terms that are used in the mortgage calculator.

**Mortgage Amount: **The amount you need to spend on a mortgage. Original principal mortgage amount when calculating the current mortgage.

**Mortgage Term: **The time left when calculating the given mortgage.

**Interest Rate: **Annual interest rate on the loan. This interest rate is charged differently.

**Monthly Payment: **The amount that you need to pay on a monthly basis towards interest and principal.

Now, look into the formula, that you need to calculate the mortgage monthly payments.

**PMT = PV i(1+i)**^{n}/ (1+i)^{n} - 1

Where,

PMT is the mortgage payment amount.

PV is the present value.

n is the number of mortgage payments.

i is the period interest rate.

**Example:**

**Question: **Suppose you wish to acquire a car that costs $34550. And to make the down payment of $1000 along with the interest of 2% on 3 years with a $15500 loan.

**Solution:**

Given, Interest = 2%, Mortgage amount = $34550, Mortgage term = 3 years.

As we know the mortgage monthly payment formula,

**PMT = PV i(1+i)**^{n}/ (1+i)^{n} - 1

**= **[$15500 * (0.02/12)( 1+ 0.02/12)^{36}] / [( 1+ 0.02/12)^{36} - 1]

= [$15500 * (0.001)( 1+ 0.001)^{36}] / [( 1+ 0.001)^{36} - 1]

**Monthly payment** = $ 989.60

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### Frequently Asked Questions on Mortgage Tools

**1. How can I calculate the mortgage monthly payment?**

Mortgage monthly payment can be calculated by using formula, PMT = PV i(1+i)^{n}/ (1+i)^{n} - 1

**2. How this mortgage calculator can be used?**

Simply give the inputs in the input fields click on the calculate button and get the answers easily.

**3. What is the interest rate in the mortgage calculator?**

Interest rate is nothing but the rate that is being charged when we are taking mortgagor any type of loan.