Mortgage Payoff Calculator — extra payments, interest saved & time cut

How it works

A fixed-rate mortgage is repaid with a required monthly payment set so the balance reaches zero exactly at the end of the term — the standard amortization formula M = P·r(1+r)ⁿ ⁄ ((1+r)ⁿ − 1), where P is the balance, r the monthly rate (the annual rate divided by 12), and n the number of payments. Anything you pay above that required amount is applied entirely to principal, so the balance drops faster than the schedule assumes. Because interest each month is charged on the outstanding balance, a lower balance means less interest every month thereafter — the saving compounds. The calculator runs the amortization both ways: baseline with no extra, and accelerated with your extra payment, and the gap between them is what the extra buys in interest saved and time cut.

Worked example

Take a $100,000 balance at 4% with 30 years left — the required payment is about $477 a month (CFPB). Add $200 to every payment and this calculator computes the rest: the loan is retired in about 17 years rather than 30 — roughly 13 years early — and total interest falls by about $33,975, because each extra dollar removes principal that would otherwise accrue interest for the rest of the term. Only the $477 payment is a published figure (CFPB); the 17-year payoff and the $33,975 saved are this page's own calculation for these inputs.

Frequently asked questions

What does paying extra on a mortgage do?

Extra payments go entirely to principal, lowering your balance faster than the schedule. Since interest is charged on the balance, a smaller balance means less interest every following month, so the loan pays off early and total interest drops — often substantially over a 30-year term.

How much interest can extra payments save?

It depends on the balance, rate, and extra amount, but because the saving compounds over the remaining term it is often large. As a concrete case, this calculator finds that an extra $200 a month on a $100,000 balance at 4% with 30 years left saves roughly $33,975 in interest and clears the loan about 13 years early — a computed figure for those inputs, not a published one. It reports the exact number for whatever balance, rate, and extra payment you enter.

How is the payoff time calculated?

The calculator amortizes month by month at your required payment plus the extra, subtracting the interest due and applying the rest to principal, until the balance reaches zero. The number of months that takes, compared with the full term, is the time saved.

Is it better to pay extra on the mortgage or invest?

That is a personal trade-off between the interest you avoid at your mortgage's fixed rate and the uncertain return of investing. This calculator quantifies only the mortgage side — how much interest a given extra payment removes over the loan — so you can weigh it against your other options.

Should I pay a little extra each month or one lump sum?

Both help, and this calculator models a recurring monthly extra applied from the next payment onward. A one-time lump sum also goes straight to principal, and the earlier it lands the more it saves, because the removed principal then avoids interest for every remaining month — a lump sum early in the term can outweigh years of small monthly extras. Enter your amount as a monthly figure to see the recurring case modeled here.

How is this different from refinancing?

Refinancing replaces the loan with a new rate or term and has closing costs. Paying extra keeps your existing loan and simply accelerates it, with no fees — it lowers the total interest by shortening the term rather than by lowering the rate.

How accurate is this, and what does it exclude?

The interest and payoff figures are exact for a fixed-rate loan and a constant extra payment. It excludes escrow (taxes and insurance), any prepayment penalty, and rate changes — confirm your loan has no prepayment penalty and treat the result as the interest-and-principal picture.