What are the assumptions of the Hypothèque formula?

Fixed-rate mortgage. For ARMs, the rate after the fixed period changes the result. Equal monthly payments. Some mortgages allow biweekly or other schedules. Interest is compounded monthly (standard for US mortgages). No prepayments. Extra payments reduce the principal and shorten the loan term.

What are the limitations of Hypothèque?

This calculator estimates P&I only. The full PITI payment includes property taxes and insurance (typically 15–35% extra). Closing costs, HOA fees, and maintenance are not included in the monthly payment. For ARMs, the actual payment will change after the initial fixed period. Regional variations in taxes and insurance can substantially change total housing cost.

Méthodologie

How we calculate mortgage payments

Our methodology for the Hypothèque calculator: the formula, step-by-step calculation, authoritative sources, and limitations. Reviewed quarterly.

Formule

M = P × [r(1+r)ⁿ] / [(1+r)ⁿ − 1]

Étape par étape

1
Determine the loan principal (P): the home price minus the down payment.
2
Determine the monthly interest rate (r): divide the annual rate by 12 (e.g. 6% APR → 0.005 per month).
3
Determine the number of payments (n): multiply the loan term in years by 12 (e.g. 30 years → 360 payments).
4
Compute (1+r)ⁿ: the compounding factor over the loan life.
5
Apply the formula: P × [r(1+r)ⁿ] / [(1+r)ⁿ − 1]. The result is the monthly principal + interest payment.
6
Add property taxes, home insurance, and PMI (if applicable) to get the full PITI payment.

Sources autorisées

Every claim on this page is backed by an authoritative source.

Hypothèses

What we take to be true when applying this formula.

Fixed-rate mortgage. For ARMs, the rate after the fixed period changes the result.
Equal monthly payments. Some mortgages allow biweekly or other schedules.
Interest is compounded monthly (standard for US mortgages).
No prepayments. Extra payments reduce the principal and shorten the loan term.

Limites

What this method does NOT capture.

This calculator estimates P&I only. The full PITI payment includes property taxes and insurance (typically 15–35% extra).
Closing costs, HOA fees, and maintenance are not included in the monthly payment.
For ARMs, the actual payment will change after the initial fixed period.
Regional variations in taxes and insurance can substantially change total housing cost.

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Dernière révision: 2026-06-15 • Reviewed by: CalcxApp editorial team