How much is the average mortgage payment?
Before buying a home, you may be wondering what the average cost of a mortgage payment is. Knowing this can help you estimate how much you’ll actually need to pay each month.
To determine your monthly costs, you’ll also need to look at the interest rate you can secure, how much of a down payment you can afford and other variables specific to your finances and taxes in your area.
What is the average monthly mortgage payment in the U.S.?
According to data from the National Association of REALTORS®, the national median home price for all housing types was $412,400 in 2024.ec-nar-housing-affordability-index Assuming a 30-year fixed mortgage at 6.81% interest, the principal and interest for a monthly mortgage payment would be $2,153. (This assumes a 20% down payment and does not include property taxes or additional costs like HOA fees.) That amounts to over 25% of the estimated median family income.ec-nar-housing-affordability-index
Factors that influence the average monthly mortgage payment
Your monthly mortgage payment usually comprises four key elements: principal, interest, taxes and insurance (or PITI).
- Principal: This is the amount you pay toward the balance of your mortgage loan.
- Interest: Interest is what you pay a lender to take out a mortgage loan, often expressed as a percentage.
- Taxes: Property taxes are based on the value of your home and determined by your local government.
- Insurance: These monthly payments cover homeowners and mortgage insurance—the latter of which you may pay if your down payment was less than 20%.
To calculate these factors, you’ll determine each that applies to your loan and then add them together.
Principal and interest payment
Assuming you have a fixed-rate mortgage, your principal and interest payments are determined using the following formula:
- P: Principal loan amount or the starting balance of your loan.
- R: The monthly interest rate is your annual mortgage interest rate divided by 12. It will be based on several factors, including your credit score.
- N: The number of payments, usually the number of years of your mortgage times 12. So a 30-year fixed-rate mortgage has 360 total payments, and a 15-year fixed-rate mortgage has 180 payments.
You would then apply the following formula:
P x (R (1+R)N / (1 + R)N - 1)
You can also use the PMT function in your favorite spreadsheet software or a mortgage calculator.
While the monthly payments for a 15-year fixed-rate mortgage are higher than those for a 30-year mortgage, the shorter term will cost borrowers less in interest over the life of the loan.
If you have an adjustable-rate mortgage, your monthly payment would stay the same during the introductory period, but afterward, it would adjust periodically based on the terms of your mortgage.
Property taxes
After you pay your principal and interest, you’ll need to pay your property taxes. These taxes help pay for community services—like fire, police and sanitation, schools, libraries, public parks, etc.
Property taxes are calculated annually and determined by your state and local tax authorities. While they can vary from year to year, they usually amount to 0%–3% of the current appraised value of your home. Assuming you pay your mortgage using an escrow account, this value is divided into monthly payments.
Insurance
One of the final components of your monthly mortgage payment is your insurance. It usually includes homeowners insurance. It may also include mortgage insurance.
Average monthly homeowners insurance
The amount you pay for homeowners insurance will vary depending on where you live, the size and condition of your home and the level of coverage dictated by the real estate market and selected by the homeowner.
One recent study estimated that for 2025, the average cost of homeowners insurance in the U.S. is $2,601 a year, or $217 a month, for $300,000 in dwelling coverage.ec-insurance-average-home-insurance-cost-in-2024
For a $300,000–$600,000 home, you can expect to pay between $215 and $388 a month for homeowners insurance.ec-insurance-average-home-insurance-cost-in-2024 This usually includes fire, theft and damage, but you may need to pay extra for earthquake or tornado coverage if you live in an area that’s at risk.
Depending on where you live, you may also need to pay an additional monthly fee for national flood insurance. Federal Emergency Management Agency (FEMA), has more information on the costs, which can vary widely by state.
Average monthly private mortgage insurance
If you were unable to make a 20% down payment when you bought your home, you may need to pay for private mortgage insurance (PMI). It’s added to your monthly payment until your loan-to-value (LTV) ratio equals 80% or lower. To calculate PMI, multiply your loan value by your PMI percentage to determine your annual cost.
According to Fannie MaeⓇ, the typical range for PMI is from 0.58%–1.86% of the loan per year.ec-fanniemae-private-mortgage-insurance
Average monthly mortgage insurance premium
If you buy your home with a Federal Housing Administration (FHA) loan, you’ll pay an upfront monthly mortgage insurance premium (MIP) and an annual MIP.ec-hud-mortage-letter-2023 The annual MIP payments could last for 11 years or the life of your loan, depending on the terms of your mortgage and the size of your down payment.
Homeowners association fees
While not always part of your monthly mortgage payment, some communities have a homeowners association (HOA) that charges a monthly fee. These fees may cover maintenance of shared areas, security and access to community amenities. The fees will vary depending on the community and what it offers, so it’s a good idea to know what they will be before you buy.
In summary
Every home is different, but if you want to determine how much your average monthly payment will be, you can add up all the factors that can influence your payment. Knowing how to calculate your payment can help you narrow down how much home you can afford.
If you’re ready to begin the homebuying journey, start with a mortgage preapproval.
