About

The 8% Mortgage Calculator is a critical tool for planning in high-rate environments or stress-testing your budget against potential market spikes. An 8% interest rate significantly increases the monthly cost of borrowing compared to lower rates, drastically changing the ratio of interest to principal in the early years of a loan.

Historically, 8% was common in the 1990s and during periods of inflation control. When rates hit this level, it is essential to minimize the principal loan amount or seek shorter terms to avoid paying double or triple the home's value in interest alone. This tool provides the hard numbers needed to make informed decisions when capital is expensive.

Formulas

This tool uses the standard amortization formula with a fixed r of 0.08 annually.

M = P × 0.00667 × (1.00667)ⁿ / ((1.00667)ⁿ - 1)

Note: 0.00667 is the repeating decimal for 8% divided by 12 months.

Reference Data

Loan Amount	Interest Rate	Monthly Payment	Total Interest Paid (30y)
$300,000	8.0%	$2,201	$492,466
$300,000	4.0%	$1,432	$215,609
$400,000	8.0%	$2,935	$656,621
$500,000	8.0%	$3,669	$820,776
$600,000	8.0%	$4,403	$984,931

Frequently Asked Questions

At 8%, the interest charge for the first month on a $300k loan is $2,000 alone. This means your monthly payment must cover that plus principal, leading to a much higher total than at lower rates.

It depends on your personal timeline and the broader economy. Sometimes, high rates reduce home prices, allowing you to buy at a lower price and refinance later if rates drop (the 'Date the rate, marry the house' strategy).

Typically, you will pay roughly 1.6 to 1.7 times the loan amount in interest alone. For a $100k loan, you pay back ~$264k total.