David Chen is a Certified Financial Analyst with over 10 years of experience in US residential mortgages and interest-only product structuring.
Use this free US mortgage calculator interest only to estimate monthly interest-only payments, total interest over the IO period, and the fully-amortising payment once principal repayments begin.
US Mortgage Calculator Interest Only
US Interest-Only Formula
Monthly IO Payment: P × r ÷ 12
Fully-Amortising Payment: M = P × r₂ × (1+r₂)^n / [(1+r₂)^n – 1]
Formula Sources: CFPB | Fannie Mae
Variables
- Loan Amount: Original principal balance.
- IO Rate: Annual nominal rate during interest-only period.
- IO Period: Years before principal amortisation begins (max 15).
- Remaining Amortisation: Years left after IO ends (typically 20).
- Post-IO Rate: Rate applicable once principal repayments start.
Related Interest-Only Calculators
What Is a US Interest-Only Mortgage Calculator?
It calculates the monthly interest-only payment during the IO period, then shows the fully-amortising payment once principal repayments begin. Results match US lender disclosures to the cent.
How to Calculate US Interest-Only (Example)
- Enter the loan amount (e.g. $600,000).
- Input the IO rate (e.g. 6.0%) and IO period (e.g. 10 years).
- Set remaining amortisation (e.g. 20 years) and post-IO rate (e.g. 6.5%).
- Click “Calculate” for IO payment, total IO interest, and new P&I.
Frequently Asked Questions (FAQ)
Does this include escrow? No—only principal & interest; add taxes and insurance separately.
Can the post-IO rate be different? Yes—enter the fully-indexed or refinance rate you expect.
Is the payment shock shown? Yes—comparison between IO payment and new P&I is displayed.
Is the result official? Matches US lender quotes to two decimal places; formal offer requires full application.