What Goes Into a Mortgage Payment?
Your monthly mortgage payment (PITI) consists of four components: Principal, Interest, Taxes, and Insurance. Most mortgage calculators calculate only the P&I component, but budgeting for all four is essential.
The Amortization Schedule
In the early years of a mortgage, most of your payment goes toward interest. As years pass, more goes toward principal. This is called amortization. Our mortgage calculator shows the full amortization schedule.
How Much Home Can You Afford?
A common rule of thumb is the 28/36 rule: spend no more than 28% of your gross monthly income on housing costs, and no more than 36% on total debt payments including mortgage, car loans, and credit cards.