How a mortgage payment is calculated
Almost all mortgages use a fixed-payment (French) amortization: you pay the same amount each month, but early payments are mostly interest and later ones are mostly principal. The formula is payment = P × i / (1 − (1 + i)−n), where P is the loan, i the monthly rate (annual rate / 12) and n the number of months.
Mortgages in the United States
The 30-year fixed mortgage is the norm. Your monthly housing cost also includes property tax (often 0.5–2% of the home’s value a year), homeowners insurance and, if you put down less than 20%, private mortgage insurance (PMI), which the calculator estimates at 0.6% of the loan a year. FHA loans allow 3.5% down with their own insurance premium. Closing costs typically run 2–5% of the price.
Mortgages in Spain, Mexico and Colombia
In Spain the 12-month Euribor, the benchmark for variable-rate loans, closed August 2026 at 2.951%, up from about 2.2% at the start of the year. Banks usually lend up to 80% of the appraised value, and buyers pay 6–10% transfer tax on resale homes. In Mexico fixed bank rates are around 10–12%, alongside Infonavit and Fovissste. In Colombia rates are close to 12–13%, with peso or UVR-indexed loans.
How much mortgage can I afford?
A common rule is that all debt payments should stay under 30–35% of net income (lenders in the US use a 36–43% debt-to-income ratio on gross income). Enter your income in the last field and the calculator will tell you where you stand.