If you’re ready to buy a home, you might wonder how to budget for your target home cost. As of April 15, 2025 the current average interest rate for a 30-year fixed mortgage is sitting at 6.86% according to Bankrate. However, your rate also depends on your personal financial factors and credit history.
Here’s a breakdown of what you might face monthly, in interest and over the life of a $200,000 mortgage.
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To afford a $200K mortgage with a 20% down payment, 30-year term and 7.00% interest rate, you’d need to make at least $38,268 a year before taxes. How much you ultimately can afford depends on your down payment, loan terms, taxes and insurance. As a general rule, your mortgage payment shouldn’t exceed one-third of your monthly income.
When you take out a mortgage, you agree to pay the principal and interest over the life of the loan. Your interest rate is applied to your balance, and as you pay down your balance, the amount you pay in interest changes.
Amortization means that at the beginning of your loan, a big percentage of your payment is applied to interest. With each subsequent payment, you pay more toward your balance.
Estimate your monthly loan repayments on a $200,000 mortgage at 7.00% fixed interest with our amortization schedule over 15 and 30 years.
| Year | Beginning balance | Monthly payment | Total interest paid | Total principal paid | Total paid throughout the year | Remaining balance |
|---|---|---|---|---|---|---|
| 1 | $200,000 | $1,331 | $13,936 | $2,032 | $15,967 | $197,968 |
| 2 | $197,968 | $1,331 | $13,789 | $2,178 | $15,967 | $195,790 |
| 3 | $195,790 | $1,331 | $13,631 | $2,336 | $15,967 | $193,454 |
| 4 | $193,454 | $1,331 | $13,462 | $2,505 | $15,967 | $190,949 |
| 5 | $190,949 | $1,331 | $13,281 | $2,686 | $15,967 | $188,263 |
| 6 | $188,263 | $1,331 | $13,087 | $2,880 | $15,967 | $185,383 |
| 7 | $185,383 | $1,331 | $12,879 | $3,088 | $15,967 | $182,295 |
| 8 | $182,295 | $1,331 | $12,656 | $3,312 | $15,967 | $178,983 |
| 9 | $178,983 | $1,331 | $12,416 | $3,551 | $15,967 | $175,432 |
| 10 | $175,432 | $1,331 | $12,160 | $3,808 | $15,967 | $171,625 |
| 11 | $171,625 | $1,331 | $11,884 | $4,083 | $15,967 | $167,542 |
| 12 | $167,542 | $1,331 | $11,589 | $4,378 | $15,967 | $163,164 |
| 13 | $163,164 | $1,331 | $11,273 | $4,695 | $15,967 | $158,469 |
| 14 | $158,469 | $1,331 | $10,933 | $5,034 | $15,967 | $153,436 |
| 15 | $153,436 | $1,331 | $10,569 | $5,398 | $15,967 | $148,038 |
| 16 | $148,038 | $1,331 | $10,179 | $5,788 | $15,967 | $142,250 |
| 17 | $142,250 | $1,331 | $9,761 | $6,206 | $15,967 | $136,043 |
| 18 | $136,043 | $1,331 | $9,312 | $6,655 | $15,967 | $129,388 |
| 19 | $129,388 | $1,331 | $8,831 | $7,136 | $15,967 | $122,252 |
| 20 | $122,252 | $1,331 | $8,315 | $7,652 | $15,967 | $114,600 |
| 21 | $114,600 | $1,331 | $7,762 | $8,205 | $15,967 | $106,395 |
| 22 | $106,395 | $1,331 | $7,169 | $8,798 | $15,967 | $97,597 |
| 23 | $97,597 | $1,331 | $6,533 | $9,434 | $15,967 | $88,162 |
| 24 | $88,162 | $1,331 | $5,851 | $10,116 | $15,967 | $78,046 |
| 25 | $78,046 | $1,331 | $5,120 | $10,848 | $15,967 | $67,198 |
| 26 | $67,198 | $1,331 | $4,335 | $11,632 | $15,967 | $55,566 |
| 27 | $55,566 | $1,331 | $3,495 | $12,473 | $15,967 | $43,094 |
| 28 | $43,094 | $1,331 | $2,593 | $13,374 | $15,967 | $29,719 |
| 29 | $29,719 | $1,331 | $1,626 | $14,341 | $15,967 | $15,378 |
| 30 | $15,378 | $1,331 | $589 | $15,378 | $15,967 | $0 |
| Year | Beginning balance | Monthly payment | Total interest paid | Total principal paid | Total paid throughout the year | Remaining balance |
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| 1 | $200,000 | $1,798 | $13,752 | $7,820 | $21,572 | $192,180 |
| 2 | $192,180 | $1,798 | $13,187 | $8,385 | $21,572 | $183,796 |
| 3 | $183,796 | $1,798 | $12,581 | $8,991 | $21,572 | $174,805 |
| 4 | $174,805 | $1,798 | $11,931 | $9,641 | $21,572 | $165,164 |
| 5 | $165,164 | $1,798 | $11,234 | $10,338 | $21,572 | $154,826 |
| 6 | $154,826 | $1,798 | $10,487 | $11,085 | $21,572 | $143,740 |
| 7 | $143,740 | $1,798 | $9,685 | $11,887 | $21,572 | $131,854 |
| 8 | $131,854 | $1,798 | $8,826 | $12,746 | $21,572 | $119,108 |
| 9 | $119,108 | $1,798 | $7,905 | $13,667 | $21,572 | $105,441 |
| 10 | $105,441 | $1,798 | $6,917 | $14,655 | $21,572 | $90,785 |
| 11 | $90,785 | $1,798 | $5,857 | $15,715 | $21,572 | $75,070 |
| 12 | $75,070 | $1,798 | $4,721 | $16,851 | $21,572 | $58,220 |
| 13 | $58,220 | $1,798 | $3,503 | $18,069 | $21,572 | $40,151 |
| 14 | $40,151 | $1,798 | $2,197 | $19,375 | $21,572 | $20,776 |
| 15 | $20,776 | $1,798 | $796 | $20,776 | $21,572 | $0 |
Buying a house is among the biggest investments you’ll make. Know how much you might pay each month on your $200,000 mortgage — including how much of your payment goes toward your interest over the principal — when shopping for a lender.
Learn more about how home loans work in our comprehensive guide to mortgages.
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