Mortgage vs Rent Calculator - Should You Buy or Rent?
Compare the true costs of buying vs renting with our comprehensive calculator. See total costs, equity building, and make the best financial decision for your situation.
Free Mortgage Calculator
Calculate your monthly mortgage payments, total interest, and view your complete amortization schedule. No signup required - get instant results.
Loan Details
20.0% down payment
Monthly Payment
$1,878
Principal & Interest
$1,478
Total Interest
$291,980
Loan Amount
$240,000
Payment Breakdown
Loan Summary
Amortization Chart
This chart shows how your payments are split between principal and interest over the life of your loan.
Early payments are mostly interest, while later payments are mostly principal.
Amortization Schedule
Showing payments 1 to 12 of 360
| Payment # | Payment | Principal | Interest | Remaining Balance | Total Interest | Total Principal |
|---|---|---|---|---|---|---|
| 1 | $1,478 | $228 | $1,250 | $239,772 | $1,250 | $228 |
| 2 | $1,478 | $229 | $1,249 | $239,543 | $2,499 | $457 |
| 3 | $1,478 | $230 | $1,248 | $239,313 | $3,746 | $687 |
| 4 | $1,478 | $231 | $1,246 | $239,082 | $4,993 | $918 |
| 5 | $1,478 | $233 | $1,245 | $238,849 | $6,238 | $1,151 |
| 6 | $1,478 | $234 | $1,244 | $238,616 | $7,482 | $1,384 |
| 7 | $1,478 | $235 | $1,243 | $238,381 | $8,725 | $1,619 |
| 8 | $1,478 | $236 | $1,242 | $238,145 | $9,966 | $1,855 |
| 9 | $1,478 | $237 | $1,240 | $237,907 | $11,207 | $2,093 |
| 10 | $1,478 | $239 | $1,239 | $237,669 | $12,446 | $2,331 |
| 11 | $1,478 | $240 | $1,238 | $237,429 | $13,684 | $2,571 |
| 12 | $1,478 | $241 | $1,237 | $237,188 | $14,920 | $2,812 |
Ready to Get Started?
Compare rates and find the best mortgage options for your situation
Compare Mortgage Rates
Get personalized mortgage quotes from top lenders
- No obligation quotes
- Competitive rates
- Fast approval
Check Your Credit Score
Free credit score check - no impact on your score
- Free credit monitoring
- Weekly updates
- Credit insights
Find the Best Mortgage Lender
Compare rates from 100+ lenders nationwide
- Multiple quotes
- Expert guidance
- Best rates guaranteed
Disclaimer: We may receive compensation from our affiliate partners when you click on links and apply for services. This helps us keep our mortgage calculator free. We only recommend services we believe provide value to our users.
Mortgage Tips
- • Aim for 20% down payment to avoid PMI
- • Compare rates from multiple lenders
- • Consider shorter loan terms for lower interest
Next Steps
- • Get pre-approved for a mortgage
- • Check your credit score
- • Gather required documentation
Buying vs Renting: The Complete Comparison
Buying a Home
Advantages
- ✓Build equity over time
- ✓Fixed monthly payments (with fixed-rate mortgage)
- ✓Tax deductions on mortgage interest
- ✓Freedom to customize and improve
- ✓Potential appreciation in value
Disadvantages
- ✗Large upfront costs (down payment, closing costs)
- ✗Maintenance and repair responsibilities
- ✗Less flexibility to move
- ✗Property taxes and insurance
Renting
Advantages
- ✓Lower upfront costs
- ✓No maintenance responsibilities
- ✓More flexibility to move
- ✓Predictable monthly costs
- ✓No property taxes or insurance
Disadvantages
- ✗No equity building
- ✗Rent can increase over time
- ✗Limited ability to customize
- ✗No tax benefits
Key Financial Factors to Consider
Upfront Costs
Down payment, closing costs, moving expenses, and initial repairs
Long-term Costs
Monthly payments, maintenance, property taxes, and insurance
Equity Building
Principal payments and potential home appreciation
Break-Even Analysis
When Buying Makes Sense
- ✓Planning to stay 5+ years
- ✓Stable income and job security
- ✓Good credit score and savings
- ✓Rent is high relative to home prices
- ✓Want to build equity and wealth
When Renting Makes Sense
- ✓Planning to move within 2-3 years
- ✓Uncertain job or income situation
- ✓Limited savings for down payment
- ✓Rent is low relative to home prices
- ✓Prefer flexibility and no maintenance
Example: $300,000 Home vs $1,500 Rent
Buying (30-year, 6.5%)
Renting
💡 In this example, renting costs $876 less per month, but buying builds equity and offers tax benefits.
Buy vs Rent FAQ
How long should I plan to stay to make buying worthwhile?
Generally, you should plan to stay at least 3-5 years to recoup closing costs and make buying financially beneficial.
What's the 5% rule for rent vs buy?
If annual rent is less than 5% of the home's value, renting may be better. If more than 5%, buying might make sense.
Should I consider home appreciation in my decision?
Yes, but don't rely on it. Historical appreciation averages 3-4% annually, but it's not guaranteed and varies by location.
What about the opportunity cost of a down payment?
Consider what you could earn by investing your down payment instead. If investment returns exceed home appreciation, renting might be better.