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$300,000 Mortgage Over 20 Years
How big is the monthly bill on $300,000 borrowed for 20 years? Find out below with a starting rate of 6 percent. Every box can be edited.
On the starting figures the payment is $2,149.29 a month and the total interest is $215,830.
How the payment is worked out
A level payment loan has a neat rule behind it. Each month the interest is the balance times 0.5 percent. The payment is set so that after 240 months the balance lands exactly at zero. Solving for it on $300,000 gives the loan times the monthly rate, divided by one minus one over one plus the monthly rate raised to the power of 240.
Worked example
Work it through with $300,000, 6 percent and 20 years. Each payment is $2,149.29. The first one sends $1,500.00 to interest and the remaining $649.29 to principal.
Over the whole loan you pay $515,830. About 72 cents of each borrowed dollar goes to interest.
Questions about this calculator
What if the rate on a $300,000 mortgage over 20 years were one point higher?
The payment would rise from $2,149.29 to $2,325.90, which is $176.60 more each month. One point lower would give $1,979.87.
Would paying $210 extra each month shorten a $300,000 mortgage over 20 years?
Yes. On this $300,000 loan an extra $210 each month ends the loan 3 years 1 month sooner and saves $38,058 of interest.
Is 20 years the right length for a $300,000 mortgage?
It depends on the monthly payment you can carry. At 6 percent this term costs $2,149.29 a month. A 30-year term would cost $1,798.65 a month and $347,515 in interest, compared with $215,830 over 20 years.
Does the $2,149.29 payment cover property tax and insurance?
No. The $2,149.29 covers principal and interest only. Tax, insurance and any mortgage insurance would sit on top of it.
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This page is for education only and is not financial or tax advice.