Mortgage Comparison Calculator
Put two loans side by side on the same home price and down payment, and compare monthly payment, total interest and total cost.
What this calculator does
This mortgage comparison calculator puts two loans side by side on the same home price and down payment. Change the rate, the term, or both, and it returns the monthly payment, the total interest, and the total cost of each — the three numbers that decide which offer is actually better.
It also builds a year-by-year table for each loan showing annual payments, equity built, and remaining balance. That equity column is the one most comparisons omit and the one that matters if you expect to sell or refinance before the term ends, because it shows how much of the house you own at any given point.
When to use it
The obvious use is comparing two Loan Estimates from competing lenders. The more valuable use is comparing terms with the same lender: 30 years against 15, or 30 against 20, where the trade between cash flow and lifetime cost is starkest.
It also handles the refinance question — enter your existing rate and remaining term as one loan and the offered refinance as the other, then check whether the monthly saving covers the closing costs within your expected time in the house. And it is the right tool when a builder offers a rate buydown: model the bought-down rate against the market rate to see what the incentive is genuinely worth against the higher price you may be paying for it.
Understanding the inputs
Home price and down payment set a loan amount shared by both scenarios, which keeps the comparison honest — only rate and term should differ. Enter the note rate for each loan, not the APR, since APR includes fees and would distort the amortization.
Loan term is where most of the difference comes from. Thirty years is the US default, fifteen is the main alternative, and twenty sits between them and is often overlooked. Note that shorter terms usually carry lower rates, typically half to three quarters of a point below the 30-year, so when you model 15 against 30 you should reduce the rate as well as the term rather than holding it constant.
How is this calculated?
Calculate monthly payment and total cost for both mortgages using the standard amortization formula.
A worked example
Take a $450,000 home with 20 percent down, giving a $360,000 loan. Loan A is 30 years at 6.75 percent: the payment is about $2,335 a month and total interest across the term comes to roughly $480,600. Loan B is 15 years at 6.0 percent: the payment rises to about $3,038 and total interest falls to roughly $186,800.
So $703 more each month saves about $293,800 over the life of the loan. Whether that is the right trade depends on what else the $703 could do. Invested at seven percent for fifteen years it would grow to roughly $223,000 — less than the interest saved, but liquid and available if you lose your job, which the equity in your house is not.
Limitations and assumptions
This compares principal and interest only. It excludes discount points, origination and lender fees, property taxes, insurance, PMI, and HOA dues, and those can easily reverse a comparison — a loan half a point cheaper but carrying two points of cost is often worse over any realistic holding period.
It also assumes fixed rates throughout, so it cannot properly model an adjustable-rate mortgage beyond its initial period, and it does not account for the tax treatment of interest. Use the Loan Estimate each lender is required to give you within three business days of application: page two lists every fee, and comparing those side by side alongside the payments here is what a genuine comparison looks like.
Common Questions
- Is a lower rate always the better loan?
- Not necessarily. A lower rate bought with discount points or a large origination fee may take five or more years to repay its own cost. Compare the monthly payment and total interest here, then set the difference against the upfront fees on each Loan Estimate before deciding.
- How do I compare a 15-year and a 30-year loan fairly?
- Look at both the monthly payment and the total interest, because they point in opposite directions. The 15-year almost always wins on lifetime cost and loses on monthly cash flow. The right question is whether the higher payment is one you could still make after a job loss or a new baby.
- What is the difference between rate and APR?
- The note rate determines your payment; APR folds lender fees into an annualized figure to make quotes comparable. Use the note rate in this calculator, since it drives the amortization. Use APR as a cross-check when two lenders quote the same rate — the one with the higher APR is charging more in fees.
- Can I just take the 30-year and pay it like a 15?
- Yes, and many people should. You get the lower required payment as a safety valve and can overpay to the 15-year schedule voluntarily. The cost is that 30-year rates typically run half a point higher, so you pay a small premium for the flexibility.
- How much does half a percentage point matter?
- On a $360,000 loan over 30 years, half a point changes the payment by about $115 a month and total interest by roughly $41,000. That is why gathering three or four Loan Estimates on the same day is worth the hour it takes — rates move daily and lender margins differ.
- Should I compare an ARM against a fixed loan here?
- Only for the introductory period. This calculator holds the rate constant for the whole term, so an ARM's later payments are not modeled. If you are considering a 7/1 ARM, run it at the intro rate to see the near-term saving, then ask the lender for the worst-case payment at the lifetime cap.
- Do the two loans need the same amount?
- For a clean comparison, yes — the calculator assumes identical loan amounts so the difference you see comes purely from rate and term. If you are weighing different down payments too, run those as separate comparisons rather than changing two variables at once.
- What about the tax deduction on mortgage interest?
- It is not modeled here, and for most households it makes no difference because they take the standard deduction. If you do itemize, interest on up to $750,000 of acquisition debt is deductible, which slightly softens the case for the shorter term — but never enough to make paying more interest a winning strategy.
- Does total interest matter if I will move in seven years?
- Much less than the lifetime figure suggests. Look at the equity built column at year seven rather than total interest across 30 years. A shorter term builds equity dramatically faster, which is the relevant number if you plan to sell and roll the proceeds into the next house.
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- Mortgage Points CalculatorFind out whether buying discount points makes financial sense by calculating your break-even period and long-term interest savings.
- Bi-Weekly Mortgage Payment CalculatorCompare a standard monthly schedule against paying half your payment every two weeks, and see the interest and years it saves.