Buying a home is the largest financial decision most people ever make, and yet the math behind a mortgage is rarely explained in plain English. After helping clients model hundreds of home loans, I can tell you the difference between a great mortgage and a painful one usually comes down to four numbers most buyers never run themselves. This 2026 guide walks through every formula a borrower actually needs — payment, amortization, interest paid over time, APR, PMI, escrow, and refinance breakeven — with worked examples and a free calculator at every step.