Mortgage Payoff Calculator
See what paying extra each month saves in time and in interest.
Result
Interest saved: $103,450.19
It assumes every extra payment is applied to principal immediately, which not every servicer does, and ignores what the same money might earn elsewhere.
- Payments avoided
- 83
- Payments with the extra
- 277
- Total interest with the extra
- $279,186.52
- Total interest as scheduled
- $382,636.71
- Scheduled payment
- $1,896.20
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Results are arithmetic estimates based on the values you enter. Rates, fees and terms are set by your lender or provider, and your actual agreement controls what you pay or receive. Confirm important figures with them or with a qualified adviser. Read the full disclaimer
How to use the Mortgage Payoff Calculator
- Enter what you owe now, not the original loan amount.
- Enter the rate and how many years are left on the current schedule.
- Enter the extra you could add to every payment and read what it removes.
Why extra payments work so hard
An extra payment does one simple thing: it reduces the balance immediately. Because interest is charged on the balance every period until the loan ends, removing principal early removes all the interest that principal would have generated for the rest of the term.
That is why the saving is so much larger than the money paid in. Adding 200 a month to a 300,000 loan at 6.5% pays in about 55,000 over the shortened term and removes over 100,000 of interest, because the loan also ends nearly seven years sooner.
each month: interest = balance × r principal = payment + extra − interestThe same arithmetic explains why extra payments made early are worth far more than the same amount paid late. In the final year there is almost no remaining interest left to cancel.
The comparison is against your own schedule
Both figures come from running the identical schedule twice, once at the scheduled payment and once with the extra added. The difference is what the extra actually removes, given your balance, your rate and your remaining term.
Entering the original loan amount instead of today’s balance will overstate the saving, because the early years are exactly where the interest is concentrated.
What this does not weigh
It does not compare against investing the money, paying off a higher-rate debt first, or keeping the cash available. A mortgage is usually the cheapest debt someone has, so a credit card balance or a car loan at a higher rate should normally be cleared first. The debt payoff calculator handles that comparison.
It also ignores tax treatment of mortgage interest where that exists, the value of keeping an emergency fund intact, and any early repayment charge in your loan agreement. Check the agreement before committing to a plan: some loans limit overpayments to a percentage of the balance each year.
Make sure the extra is applied as principal
The whole result depends on the servicer treating the extra as a principal reduction on receipt. If it is held and applied to the next scheduled instalment instead, the balance does not fall early and none of this saving materialises. Confirm in writing, then verify on the following statement that the balance dropped by the full extra amount.
With your numbers
- Scheduled payment = $1,896.20, plus $200.00 extra each month
- Cleared in 277 payments instead of 360, 6 years and 11 months earlier
- Interest $382,636.71 → $279,186.52, saving $103,450.19
Quick reference
It assumes every extra payment is applied to principal immediately, which not every servicer does, and ignores what the same money might earn elsewhere.
| Example | Interest saved |
|---|---|
| USD 300,000 at 6.5%, 200 extra | $103,450.19 |
| USD 300,000 at 6.5%, 500 extra | $179,761.68 |
| USD 300,000 at 6.5%, 100 extra | $60,995.81 |
| USD 220,000 at 5.75%, 20 years left, 300 extra | $43,687.91 |
| USD 150,000 at 7%, 15 years left, 250 extra | $24,803.29 |
| USD 400,000 at 6%, no extra payment | $0.00 |
| EUR 240,000 at 4%, 25 years left, 200 extra | €32,560.58 |
| EUR 180,000 at 3.5%, 20 years left, 150 extra | €13,050.87 |
Common questions about the Mortgage Payoff Calculator
- Why does a small extra payment save so much?
- Every extra dollar goes straight to principal, and that principal would otherwise have accrued interest for the whole remaining term. On a 30-year loan at 6.5%, 200 a month removes over 100,000 of interest and eighty-three payments.
- Is it better to pay extra or to invest the money?
- That depends on the rate you would earn after tax compared with the rate you are paying, and on how much certainty you want. Paying down a loan gives a guaranteed return equal to its rate; an investment does not. This calculator only shows one side.
- Will my servicer apply the extra to principal?
- Not automatically in every case. Some hold it as a prepayment of the next instalment, which saves nothing. Tell the servicer in writing that extra amounts are principal-only, and check the next statement.
- Does my payment go down?
- No. The scheduled payment stays the same and the loan ends earlier instead. Reducing the payment requires the lender to recast the loan, which is a separate request and often carries a fee.