Mortgage Payoff Calculator
- Updated
- Formula shown
- Free, no sign-up
Results
Paid off 5 years 6 months sooner, in Mar 2046, saving $64,928 in interest.
- Scheduled payments only
- $256,405
- With extra payments
- $191,477
| Year | Scheduled | With extra payments | Interest saved so far |
|---|---|---|---|
| 1 | $245,872 | $243,399 | $72.81 |
| 2 | $241,468 | $236,357 | $311 |
| 3 | $236,769 | $228,843 | $726 |
| 4 | $231,755 | $220,825 | $1,330 |
| 5 | $226,405 | $212,271 | $2,135 |
| 6 | $220,697 | $203,143 | $3,154 |
| 7 | $214,607 | $193,405 | $4,403 |
| 8 | $208,109 | $183,014 | $5,895 |
| 9 | $201,176 | $171,927 | $7,649 |
| 10 | $193,778 | $160,098 | $9,681 |
Assumes the 6.5% rate stays the same and every extra payment goes to principal. Ask your servicer to apply extra money to principal, and check your loan has no prepayment penalty.
How to use the mortgage payoff calculator
- Enter the principal balance from your latest statement and your interest rate.
- Enter either the years and months left on the loan or your current principal-and-interest payment. The calculator works out the other one.
- Add an extra monthly amount, a one-time payment and the payment number it goes with (1 is your next payment).
- Compare the new payoff date and the interest saved, and check the yearly balances in the table.
How extra payments shorten a mortgage
New balance = balance − (payment − interest) − extra
Months left with payment M: n = −ln(1 − B × r ÷ M) ÷ ln(1 + r)
Here r is the annual rate divided by 12, B is the balance and M is the monthly principal-and-interest payment. Your required payment doesn't change when you prepay. Each extra dollar comes straight off the balance, so every later month charges interest on a smaller amount and more of the fixed payment goes to principal. The effect compounds, which is why small, early extras matter. The calculator runs the full schedule month by month, so the final payment is exact.
Worked example
You owe $250,000 at 6.5% with 25 years left, so the scheduled payment is $1,688.02 and you would pay $256,405 of interest from here. Adding $200 a month clears the loan in 19 years 6 months instead of 25 years. That is 5 years 6 months sooner, and it saves $64,928 in interest.
Timing matters for lump sums. A $10,000 payment made now saves $36,747 and 2 years 3 months. The same $10,000 paid ten years from now saves $15,448 and 1 year 3 months, because there are fewer years left for the saving to build.
One extra payment a year, made as one-twelfth extra each month ($140.67), saves $49,728 and takes 4 years 2 months off this loan.
Extra monthly payments on a $250,000, 6.5%, 25-year balance
| Extra per month | Paid off in | Time saved | Interest saved |
|---|---|---|---|
| $50.00 | 23 years 4 months | 1 year 8 months | $20,508 |
| $100 | 21 years 11 months | 3 years 1 month | $37,671 |
| $200 | 19 years 6 months | 5 years 6 months | $64,928 |
| $300 | 17 years 8 months | 7 years 4 months | $85,737 |
| $500 | 14 years 11 months | 10 years 1 month | $115,668 |
| $1,000 | 10 years 10 months | 14 years 2 months | $157,724 |
Before you pay extra
- Tell your servicer it is for principal. Some servicers hold unlabeled extra money as an early payment for next month. Use the "additional principal" box or option.
- Check for a prepayment penalty. Most US home loans today have none, but some older or non-standard loans do. Your note or Closing Disclosure will say.
- Keep an emergency fund first. Money paid into the house is hard to get back without a new loan. Paying off high-interest debt usually saves more than prepaying a mortgage.
- Compare with your rate. Prepaying earns a guaranteed return equal to your mortgage rate. If you can reliably earn more elsewhere after tax, investing may come out ahead. If your rate is high, prepaying is hard to beat.
- Recasting is different. After a large lump sum, some lenders will re-amortize the loan for a fee. That lowers your required payment instead of shortening the term.
To see every payment with your extras, use the mortgage amortization calculator. If rates have fallen, compare prepaying with a refinance. For a new loan, start with the mortgage calculator.
Frequently asked questions
How much does an extra $200 a month save on a mortgage?
On a $250,000 balance at 6.5% with 25 years left, the scheduled payment is $1,688.02. Adding $200 a month pays the loan off in 19 years 6 months, 5 years 6 months sooner, and saves about $64,900 in interest.
Is it better to make a lump-sum payment early or late?
Early. A $10,000 lump sum on that same $250,000 balance saves about $36,700 in interest if paid now, but only about $15,400 if paid ten years later, because there is less time left for the lower balance to save interest.
Do extra payments lower my monthly payment?
No. On a standard fixed-rate mortgage, the required payment stays the same and the loan simply ends sooner. To lower the payment after a large lump sum, ask your lender about a recast, which re-amortizes the remaining balance for a fee.
What does one extra payment a year do?
Paying one-twelfth of a payment extra each month adds up to one extra payment a year. On a $250,000, 6.5%, 25-year balance that is $140.67 a month, which takes 4 years 2 months off the loan and saves about $49,700 in interest.
Should I pay off my mortgage early or invest?
Prepaying earns a guaranteed return equal to your mortgage rate. Investing may earn more but is not guaranteed. Many people first build an emergency fund, pay off higher-interest debt and capture any employer retirement match, then weigh prepaying against investing.