Mortgage Comparison Calculator
Enter two mortgage offers and instantly see which costs less over the full loan life, with balance milestones and a term-by-term interest comparison.
⚖️ What is a Mortgage Comparison Calculator?
A mortgage comparison calculator is a tool that places two or more mortgage scenarios side by side so you can evaluate total cost, monthly payment, and equity buildup at the same time. Rather than calculating each loan separately and manually comparing the numbers, this calculator computes both scenarios simultaneously and displays a direct comparison table. It eliminates the arithmetic errors that come from switching between tabs or writing down numbers from different tools.
The Loan Compare mode is most useful when you have received proposals from two different lenders and want to know which offer actually costs less over the life of the loan. A lower interest rate does not always win, because a lower rate on a longer term or on a larger loan amount can produce a higher total cost than a slightly higher rate on a shorter term. This calculator shows total paid (principal plus interest) for both options, which is the definitive comparison metric. The balance milestone rows also show remaining balances at years 5, 10, 15, and 20, which is critical for borrowers who plan to sell or refinance before the loan matures.
The Term Compare mode answers the question every first-time borrower faces: 15-year, 20-year, or 30-year? The three terms are shown in a single table with monthly payment, total interest, total paid, and the interest savings relative to the 30-year baseline. The key insight is always the same: shorter terms cost far less in total interest but require a meaningfully higher monthly payment. A common misconception is that the 30-year is obviously better because the lower payment lets you invest the difference. In practice, the required return on that invested difference to break even on the 30-year choice is often higher than what most investors consistently achieve after taxes.
Both modes use the standard fixed-rate amortization formula, which is the same formula used by every US mortgage lender for conventional loans. Results appear instantly as you move any slider, making it easy to test dozens of scenarios in seconds without clicking Calculate each time.
📐 Formula
M = P × r(1 + r)n ÷ [(1 + r)n − 1]
M = monthly payment
P = loan principal (amount borrowed)
r = monthly interest rate = annual rate ÷ 12 ÷ 100
n = total number of payments = term years × 12
Balance at year y: Bᵧ = P×(1+r)12y − M×[(1+r)12y−1]÷r
Example: $400,000 at 6.5% for 30 yrs: r = 0.005417, n = 360, M = $2,529/month. Total interest = $510,440.
📖 How to Use This Calculator
Steps
1
Choose your comparison mode. Select Loan Compare to compare two specific mortgage offers with different amounts, rates, or terms, or select Term Compare to see 15, 20, and 30-year options for a single loan side by side.
2
Enter loan details for both options. For Loan Compare mode, fill in the loan amount, interest rate, and term for both Option A and Option B. Defaults are pre-filled so results appear immediately on page load.
3
Read the comparison table. The table shows monthly payment, total interest, total paid, and remaining balance at key year milestones. The summary boxes highlight the winner by total cost and the monthly payment difference between options.
4
Switch to Term Compare for a single loan. In Term Compare mode, enter one loan amount and one interest rate. The calculator instantly shows 15, 20, and 30-year side by side with interest saved versus the 30-year baseline for each shorter term.
💡 Example Calculations
Example 1 — Two Lender Offers at Different Rates
Option A: $400,000 at 6.5% for 30 years vs Option B: $400,000 at 7.0% for 30 years
1
Option A: r = 0.005417, n = 360. Monthly payment = $2,529. Total interest = $510,440.
2
Option B: r = 0.005833, n = 360. Monthly payment = $2,661. Total interest = $557,960.
3
Option A is cheaper: $47,520 lower total interest and $132/month lower payment. Balance at year 10: Option A = $336,000 vs Option B = $340,000, showing faster equity buildup at the lower rate.
Option A saves $47,520 in total interest over 30 years.
Try this example →Example 2 — Same Rate, Different Terms (30-Year vs 15-Year)
$400,000 at 6.5%: 30-year vs 15-year comparison
1
30-year monthly = $2,529. Total interest = $510,440. Total paid = $910,440.
2
15-year: r = 0.005417, n = 180. Monthly = $3,488. Total interest = $227,840. Total paid = $627,840.
3
The 15-year saves $282,600 in interest at a cost of $959 more per month. Break-even: if you invest the $959/month difference at above 7% annually, the 30-year choice can win. Below 7%, the 15-year is better.
15-year saves $282,600 in interest | Extra cost: $959/month
Try this example →Example 3 — 15 vs 20 vs 30 Years on $350K at 6.75%
$350,000 at 6.75%, comparing all three standard terms
1
30-year: Monthly = $2,270/month. Total interest = $467,200. Total paid = $817,200.
2
20-year: Monthly = $2,659/month ($389 more). Total interest = $288,160. Interest saved vs 30-yr = $179,040.
3
15-year: Monthly = $3,096/month ($826 more). Total interest = $207,280. Interest saved vs 30-yr = $259,920.
15-year saves $259,920 vs 30-year | 20-year saves $179,040
Try this example →❓ Frequently Asked Questions
How do I compare two mortgage offers to find the better one?
Enter the loan amount, interest rate, and term for each offer in the Loan Compare tab. The calculator displays monthly payment, total interest, total paid, and remaining balance at year 5, 10, 15, and 20 for both options. The verdict box shows which option saves more over the full loan life and the total dollar difference. For short holding periods, compare the balance at the year closest to your expected sale date rather than the 30-year total.
Is a lower interest rate always the better mortgage offer?
Not always. A lower rate on a longer term can cost more in total interest than a slightly higher rate on a shorter term. Closing costs, origination fees, and points can also offset a rate advantage. This calculator compares total paid (principal plus interest) to give you the real picture. Add origination fees to the loan amount in each field to convert the comparison to a true all-in financing cost analysis.
How much more does a 30-year mortgage cost than a 15-year mortgage?
On a $350,000 loan at 6.75%, the 30-year mortgage costs about $467,000 in total interest versus roughly $207,000 for the 15-year mortgage, a difference of approximately $260,000. The 15-year monthly payment is about $826 higher. Use the Term Compare tab on this calculator to see exact figures for any loan amount and rate. The dollar savings from the 15-year option often surprise first-time homebuyers who focus primarily on the monthly payment.
When should I choose a 20-year mortgage instead of 30 years?
Choose a 20-year mortgage when the 15-year monthly payment exceeds your comfortable budget but you still want to save significantly on interest. On a $350,000 loan at 6.75%, the 20-year payment is $389 more per month than the 30-year (versus $826 more for the 15-year), while saving roughly $179,000 in total interest. The 20-year is the best middle-ground when cash flow matters but you want to avoid paying the maximum interest cost of a 30-year loan.
Should I include closing costs in the loan comparison?
Yes, if you are rolling closing costs into the loan or comparing lenders with different fee structures. Adding closing costs to the loan amount in each field converts the comparison from rate-only to true cost-of-financing. If Lender A charges $3,000 in fees and Lender B charges $8,000, enter $403,000 versus $408,000 on a $400,000 loan to see the real total cost difference. This approach often reveals that a slightly higher rate with low fees beats a lower rate with high fees.
How does the balance milestone feature help me compare mortgages?
The balance at year 5, 10, 15, and 20 shows how much equity each option builds at key decision points. If you expect to sell in 8 years, the year-10 balance is more relevant than the 30-year total cost. A loan with a slightly higher rate but shorter term may show a substantially lower balance at year 10, meaning you capture more equity at sale. This is especially important in a rising home-price market where equity at sale determines net proceeds.
Can I compare a fixed-rate mortgage with an adjustable-rate mortgage?
For the initial ARM fixed period, enter the ARM rate and the fixed-period length as the term. This compares the ARM cost during the initial period against a fixed-rate alternative for the same duration. This approach cannot model the adjustable portion after the initial ARM period. For full ARM analysis including adjustment caps, floors, and projected payments after the reset, use the ARM Mortgage Calculator on this site.
What is the break-even point between a 15-year and 30-year mortgage?
The break-even analysis compares investing the monthly payment difference (say $800/month) at a market return versus paying the lower total interest on the 15-year loan. If you can consistently earn more after taxes on that $800 per month than the mortgage rate, the 30-year wins financially. Most financial planners estimate the required investment return to justify a 30-year over a 15-year at 6 to 8% annually after taxes, which is achievable but not guaranteed. The 15-year is the risk-free choice.
How does a 0.5% rate difference affect total mortgage cost?
On a $400,000 30-year mortgage, a 0.5% rate difference changes monthly payment by about $132 and total interest by roughly $47,500. On a $600,000 loan the same difference scales to about $70,000 in lifetime interest. Use this calculator with both rates to see the exact impact for your specific loan amount. Small rate differences become large dollar amounts on big loans over long terms, which is why shopping multiple lenders for even 0.25% is worth the effort.
What if one mortgage has a different loan amount because of a larger down payment?
Enter each scenario's loan amount directly. To compare a 10% down payment versus a 20% down payment on a $500,000 home, enter $450,000 (10% down) as Option A and $400,000 (20% down) as Option B. The total cost comparison will include the difference in principal as well as interest, showing you the true all-in cost of each down payment strategy. Note that the 10% scenario may also carry PMI, which you can add to the loan amount as an estimated cost.
Can I use this calculator for home equity loans or second mortgages?
Yes. The amortization formula is the same for any fixed-rate installment loan. Enter the home equity loan amount, rate, and term to compare two HELOC or home equity loan offers, or use the Term Compare mode to evaluate 5, 10, or 15-year home equity loan terms. Simply enter the home equity loan amount and set the term to the options you are considering.
How do I know which mortgage term is right for my situation?
Use the Term Compare tab and apply a simple budget test: if you can comfortably afford the 15-year payment without reducing emergency savings or retirement contributions, choose 15 years. If the 15-year payment is too high but the 20-year is manageable, choose 20 years. Reserve the 30-year for situations where monthly cash flow flexibility is essential, such as variable income, planned large expenses in the near term, or when you plan to sell within 7 to 10 years and total cost over the full term is less relevant.