Mortgage Payoff Calculator

See how much interest and time you save by paying extra on your mortgage. The mortgage payoff calculator compares your loan with and without extra payments, month by month.

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Interest saved
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Estimate only. Not financial advice.

How to use the Mortgage Payoff Calculator

  1. Enter your current Loan balance, Interest rate, and Remaining term.
  2. Enter the Extra payment each month. Add a One-off lump sum and the month you plan to pay it, if any.
  3. Press Calculate. The interest you save comes first, then how much sooner the loan is paid off and both totals.

How it works

The calculator runs the amortization schedule twice. Both use the same regular payment:

payment = balance × i ÷ (1 − (1 + i)^−n)

In the second run, the extra amount goes straight to principal every month, and the lump sum in its month. Because the balance falls faster, each later month charges less interest. The savings are the difference in total interest, and the time saved is the difference in the number of payments.

Examples

  • $200,000 at 6% with 30 years left, plus $200 a month: paid off in 252 months (21 years) instead of 360. Interest falls from $231,676.38 to $151,875.87, a saving of $79,800.51.
  • The same loan with a single $10,000 payment in month 12 and no monthly extra: paid off in 318 months, saving $41,044.31.

Pay extra or invest the money?

Every extra dollar on a 6% mortgage earns a guaranteed 6% by avoiding interest. If you expect a higher return elsewhere after tax, investing may come out ahead, but with more risk. Many people also keep an emergency fund first, because money paid into a house is hard to get back quickly.

Limitations

  • Assumes a fixed rate and that your lender applies extra payments to principal. Check that there is no prepayment penalty.
  • Taxes and insurance are left out, because paying early does not change them.
  • Interest is calculated monthly. Lenders that compute it daily may differ slightly.

Frequently asked questions

How much does an extra $200 a month save on a mortgage?

On a $200,000 loan at 6% over 30 years, it saves $79,800.51 in interest and pays the loan off 9 years early.

Is a lump sum or monthly extra better?

Money paid earlier saves more interest. A lump sum today beats the same total spread over later months.

Will my monthly payment go down?

No. With extra payments the payment stays the same and the loan ends sooner. Lowering the payment needs a recast or refinance.

Often used together with the Mortgage Payoff Calculator.