Mortgage Calculator
Full PITI with HOA + PMI. The bank's calculator stops at P&I; landlords need the rest.
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Sam's Take
Most mortgage calculators stop at principal and interest. As a landlord, the number that matters is full PITI plus HOA — that's what I'm comparing to rent. If you're looking at a property where total monthly payment is more than 70% of expected rent, you're not investing, you're subsidizing your tenants. Walk away.
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What your monthly mortgage payment actually is
When the bank quotes you a mortgage payment, they usually mean just principal and interest — the money that goes toward the loan itself. That's not your real monthly cost. Your real monthly cost is principal, interest, property tax, insurance, and (if you have one) HOA dues and PMI. We call all that PITI for short: Principal, Interest, Tax, Insurance. Add HOA on top.
PMI is private mortgage insurance — extra money the bank charges you every month if you put less than 20% down on a conventional loan. It's not insurance for you. It's insurance for the bank, in case you stop paying. Once you have 20% equity, you can get rid of it. Until then it's just dead weight on your payment.
The actual math
Monthly principal and interest comes from the amortization formula:P × [r(1+r)^n] / [(1+r)^n − 1]P is the loan amount, r is the monthly interest rate (your annual rate divided by 12), and n is the number of monthly payments (years × 12). You don't have to do this by hand — the calculator does it and adds tax, insurance, HOA, and PMI on top so you see the full monthly check you're going to write.
What's a "good" payment?
For a home you're going to live in: most banks want your full housing cost (PITI + HOA) to be under 28% of your gross monthly income. That's the conservative target. If you're stretching past 35%, you're going to feel it — every month, every car repair, every kid's birthday. Don't let the bank's max number be your target. Their max is the ceiling, not the goal.
For a rental property the math is different. You're not comparing PITI to your paycheck — you're comparing it to the rent. After 12 years and 200+ units, my rule is simple: if PITI is more than 70% of expected rent, the deal doesn't work. That last 30% sounds like profit but it isn't. It's vacancy (a unit empty one month a year is already 8%), maintenance, the boiler that dies in February, and management. By the time those hit, you're at break-even or worse.
Things people miss
- PMI on low down payments. If you're putting less than 20% down on a conventional loan, PMI usually runs 0.5% to 1.5% of the loan per year. On a $400K loan that's $170-$500 a month extra and a lot of calculators don't include it.
- Underestimating property tax. Massachusetts averages around 1.2%, but it varies wildly town to town in New England — some towns are 2%+. Don't use a generic number. Pull the real assessed value and tax rate from the town's assessor site.
- Forgetting HOA on condos and townhouses. Easily $200-$500/month, sometimes more for buildings with elevators and amenities. A condo that looks affordable on price can be unaffordable on HOA. And HOAs go up.
- Using 30-year math for a commercial deal. Most commercial loans (5+ unit buildings) aren't 30-year fixed — they're 25-year amortization with a 5- or 7-year balloon. That means you're refinancing into whatever the rate is in 5-7 years, which is a real risk you have to plan for.
If you're looking at a rental and want cash flow, cap rate, and cash-on-cash return all in one place, use the Rental Property Calculator. This one gets you the payment number; that one tells you whether the deal actually works.