How to Work Out Your Down Payment and What Is Left to Borrow
A percentage sounds small until you turn it into cash. This check turns the price and the percentage into the real up-front sum and the loan that follows.
What is the Down Payment Calculator?
The down payment is a percentage of the purchase price, paid up front, and the remainder is borrowed. This calculator multiplies the price by your chosen percentage to get the down payment, subtracts it to get the loan, then applies the standard loan formula at your rate and term to estimate the monthly payment on that loan.
How to use it
- Enter the purchase price and the down payment percentage.
- Enter the annual interest rate and the loan term in years.
- Press Calculate to see the down payment, loan amount and monthly payment.
Worked example
Price 200000, down payment 20%, rate 5%, term 25 years: down payment 40000, loan amount 160000, monthly payment about 935.34.
How does a bigger down payment change my monthly payment?
It shrinks the loan, and a smaller loan needs a smaller monthly payment at the same rate and term. It also cuts total interest, because interest is charged on a lower balance from the start. The trade-off is the cash you hand over on day one, which is no longer available for anything else.
Frequently asked questions
What down payment percentage should I aim for?
There is no universal answer. A larger percentage lowers the loan and the monthly payment, but it also ties up cash you might need for other costs, so balance the two.
Is the down payment part of the loan?
No. It is paid up front from your own funds, and only the remaining price is borrowed and repaid with interest.