Extra Payment Calculator
See how extra payments shorten your mortgage and save interest.
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This tool is for informational and educational purposes only. It is not a substitute for professional financial, medical, legal, or engineering advice. See Terms of Service.
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This calculator shows the impact of making additional principal payments on your mortgage. Here is how to use it:
- Enter your loan details. Input your loan amount, interest rate, and term. These should match your current mortgage.
- Add extra monthly payments. Even $100 to $200 per month can save years and tens of thousands in interest.
- Add extra yearly payments. Some people use tax refunds or bonuses to make one large extra payment per year.
The calculator shows how many months you will save and how much less interest you will pay compared to the standard payment schedule. You can combine monthly and yearly extra payments for maximum impact.
Extra payments go entirely toward principal, which reduces the balance that accrues interest. The earlier you start making extra payments, the greater the savings.
About Extra Mortgage Payments
Making extra payments on your mortgage is one of the simplest ways to build equity faster and reduce total interest. Unlike refinancing, there are no fees or closing costs. You simply pay more than the minimum required amount, and the extra goes directly to reducing your principal balance.
Before making extra payments, check that your loan has no prepayment penalty (most conventional loans do not). Also consider whether higher-interest debt like credit cards should be paid off first.
Frequently Asked Questions
How much can I save with an extra $100/month?
On a $280,000 loan at 6.5% for 30 years, an extra $100/month saves about $68,000 in interest and pays off the loan about 5 years early. The savings compound because every dollar of extra principal you pay today prevents interest from accruing on that dollar for the remaining term.
Is it better to make extra monthly or yearly payments?
Extra monthly payments are slightly more effective because they reduce the principal sooner, preventing more interest from accruing. However, the difference is small. The most important thing is consistency. Use whatever schedule works best for your budget.
Should I pay extra on my mortgage or invest instead?
If your mortgage rate is lower than your expected investment return, investing may produce higher returns. For example, if your rate is 4% and you expect 7% from stocks, investing wins mathematically. But paying off a mortgage provides a guaranteed return equal to your interest rate and the psychological benefit of being debt-free.
Do extra payments have any fees?
Most conventional mortgages have no prepayment penalty, so extra payments are free. Some older loans or certain FHA/VA loans may have restrictions. Check your loan documents or contact your servicer to confirm.