Enter your current balance, rate, and term, then add an extra monthly or one-time payment to see the new payoff time and how much interest you'd save.
Every extra dollar goes straight to principal instead of accruing interest first, so the loan balance drops faster than the original schedule assumed. Because interest is calculated on the remaining balance each month, a lower balance means less interest the very next month — and that effect compounds over the life of the loan into meaningfully fewer total months and dollars paid. This calculator simulates the loan month by month with your extra payment included, then compares it against the standard schedule with no extra payments.
Yes — earlier is always better. A dollar of extra principal paid in year one eliminates interest on that dollar for every remaining month of the loan, while the same dollar paid in the final year only saves a few months of interest. This is exactly why a one-time lump sum near the start of the loan (from a bonus, tax refund, or inheritance) tends to outperform the same dollar amount spread out later — try entering a one-time payment above and watch how much more it moves the total interest saved compared to spreading it across future monthly payments.
Extra payments, modeled here, keep your existing rate and term but shrink the balance faster, saving interest without changing your required minimum payment. Refinancing replaces the loan entirely — usually to lock in a lower rate or a different term — but comes with new closing costs and a new underwriting process; see the Mortgage Calculator to model a fresh loan. Recasting keeps your existing loan and rate, but after a lump-sum payment the lender re-amortizes the remaining balance, which lowers your required monthly payment (rather than shortening the term) for a smaller fee than a refinance.
Most conventional US mortgages originated in recent years don't carry prepayment penalties, but it isn't universal — some loans, particularly non-conforming, investment-property, or older loans, still do. Check your loan's promissory note or ask your servicer directly before committing to an aggressive extra-payment plan, and confirm the servicer actually applies extra amounts to principal rather than to your next scheduled payment (some require an explicit instruction on the payment or through their online portal).
Worked example: a $250,000 balance at 6.5% with 25 years remaining has a standard payment of about $1,688.02/month, for roughly $256,405 in total interest over the remaining term if nothing extra is paid. Adding $200 extra every month cuts the payoff time to about 19 years 6 months — 5 years 6 months sooner — and drops total interest paid to roughly $191,477, a savings of about $64,928. Enter your own numbers above, including any one-time lump sum, to see your specific payoff date and savings.
Want the full year-by-year amortization schedule instead? Use the Mortgage Calculator. Carrying other debts alongside the mortgage? See the Debt Payoff Calculator for a payoff strategy across everything you owe.