Mortgage Comparison Calculator
Enter the details for up to three mortgages and this calculator shows you the monthly payment, total interest, and total cost for each loan in a single view. Change the loan amount, interest rate, or term on any loan and all results update instantly. The side-by-side comparison, amortization chart, and worked steps make it easy to see which option saves you the most money over the life of the loan.
Worked example
Loan 1: $400,000 at 6.5% for 30 years. Monthly rate = 6.5 / 100 / 12 = 0.005417. Monthly payment = 400,000 × 0.005417 × (1.005417)^360 / ((1.005417)^360 - 1) = $2,528.27. Total interest = $2,528.27 × 360 - $400,000 = $510,177. Loan 2: $400,000 at 6.0% for 30 years. Monthly payment = $2,398.20. Total interest = $463,353. Interest saving with Loan 2 = $510,177 - $463,353 = $46,824. If Loan 2 has $2,000 higher closing costs, break-even = $2,000 / ($2,528.27 - $2,398.20) = $2,000 / $130.07 = 15.4 months, so you break even in 16 months.
How to use this calculator
Enter the loan amount, annual interest rate, term, and closing costs for each mortgage. Loan 1 and Loan 2 are always active. Toggle "Compare a third loan" to add a third option. All results update as you type, so you can experiment freely. The comparison panel shows monthly payment, total interest, and total cost side by side. The break-even figure tells you how many months it takes for the monthly savings from a lower rate on loan 2 to recover any extra upfront fees you paid. The amortization chart shows how the balance falls over time for each loan, and the annual schedule table lets you see principal and interest splits year by year.
What the amortization formula means
Every fixed-rate mortgage uses the same formula: monthly payment = P x r(1+r)^n / ((1+r)^n - 1), where P is the principal, r is the monthly interest rate (annual rate divided by 12), and n is the total number of monthly payments. In the first months, most of each payment covers interest. Over time the balance falls, so the interest portion shrinks and more of each payment chips away at the principal. That shift is visible in the amortization schedule. A shorter term or lower rate accelerates this paydown, which is why a 15-year loan at 6% costs far less in total than a 30-year loan at the same rate even though the monthly payment is higher.
Rate vs term trade-offs
Two loans can look similar on paper but differ enormously in total cost. A lower rate always reduces both the monthly payment and the total interest on the same loan amount and term. A shorter term raises the monthly payment but dramatically reduces the total interest because you borrow for fewer years. Comparing across both dimensions at once - rate and term - is where this calculator is most useful. For example, a 15-year loan at 6.5% and a 30-year loan at 6.0% might have similar monthly payments, but the 15-year option will save tens of thousands in interest and leave you debt-free fifteen years sooner.
How to factor in closing costs and break-even
A lower rate often comes with higher closing costs: origination fees, discount points, or appraisal charges. Whether paying more upfront for a lower rate makes sense depends on how long you keep the loan. The break-even calculation divides the extra closing costs by the monthly payment savings. If you sell or refinance before the break-even date, the upfront cost was not worth it; if you stay past it, you come out ahead. A common rule of thumb is that buying down the rate makes sense if the break-even is under 36 months and you are confident you will stay in the home.
How interest rate affects total interest on a $400,000 30-year mortgage
| Rate | Monthly Payment | Total Interest | Total Cost |
|---|---|---|---|
| 5.00% | $2,147 | $373,023 | $773,023 |
| 5.50% | $2,271 | $417,612 | $817,612 |
| 6.00% | $2,398 | $463,353 | $863,353 |
| 6.50% | $2,528 | $510,177 | $910,177 |
| 7.00% | $2,661 | $558,035 | $958,035 |
| 7.50% | $2,797 | $606,882 | $1,006,882 |
| 8.00% | $2,935 | $656,678 | $1,056,678 |
All figures assume a $400,000 loan with a 30-year term. Actual costs will vary.
Frequently asked questions
What is the difference between interest rate and APR?
The interest rate is the base cost of borrowing expressed as a percentage. APR (Annual Percentage Rate) adds in mandatory fees like origination charges and points, then expresses the total cost as an annualised rate. APR is always equal to or higher than the stated interest rate. For comparing the true cost of two loans, APR is more informative than the headline rate alone, which is why this calculator also has a closing-costs field - together they capture what each loan actually costs.
Should I choose a 15-year or 30-year mortgage?
A 15-year mortgage typically carries a lower interest rate and you pay far less total interest, but the monthly payment is substantially higher because the principal is repaid twice as fast. A 30-year mortgage spreads payments over twice as long, resulting in a lower monthly obligation but much more interest paid over the life of the loan. Use this calculator with both terms to see the exact difference for your loan amount and rate - the numbers are often more striking than people expect.
How does the break-even calculation work?
The break-even tells you how many months of lower monthly payments it takes to recover any extra closing costs you paid to obtain a better rate. Divide the extra upfront cost by the monthly payment savings. For example, if loan 2 costs $3,000 more to close but saves $130 per month, the break-even is 3,000 / 130 = about 23 months. If you sell or refinance before month 23, the cheaper-upfront loan would have been the better financial decision.
Does a lower rate always mean a lower total cost?
Not necessarily, because the term length also matters. A lower rate on a 30-year loan can cost more in total than a higher rate on a 15-year loan, simply because interest compounds over twice as many years. Similarly, a lower rate with significantly higher closing costs may not break even if you plan to move within a few years. Total cost - principal plus all interest plus all fees - is the most honest comparison, and this calculator shows it for each loan.
What is a good interest rate for a mortgage in 2026?
Mortgage rates change daily and depend on the economic environment, your credit score, loan-to-value ratio, loan type, and lender. As a general guide, a rate within 0.5% of the nationally published average for your loan term is competitive. Check current published averages from sources like Freddie Mac's Primary Mortgage Market Survey, then use this calculator to see how small rate differences translate into real dollar amounts over the life of your loan.
What closing costs should I include?
Common closing costs include origination fees (typically 0.5-1% of the loan), discount points (each point costs 1% of the loan and typically reduces the rate by 0.25%), appraisal fees, title insurance, attorney fees, and prepaid items like homeowner's insurance and property tax escrows. On a $400,000 loan you might see $8,000-$15,000 in total closing costs depending on location and lender. Include any fees that differ between your loan options in the closing-cost field so the break-even calculation is accurate.