Mortgage Payoff Calculator
Find out how much time and interest you save by paying extra toward your mortgage.
About Mortgage Payoff Calculator
Every extra dollar you pay toward principal reduces the balance on which future interest accrues. This compounding benefit means even a small regular extra payment shortens your term and saves a multiple of the payment in interest over time. The calculator runs the full amortization schedule both ways and differences the results.
Formulas
Scheduled payment
M = P × r(1+r)ⁿ / ((1+r)ⁿ − 1)
- P
- Remaining loan balance
- r
- Monthly interest rate (annual rate ÷ 12)
- n
- Remaining number of months
- M
- Scheduled monthly payment
Interest saved
Interest saved = Total interest (no extra) − Total interest (with extra)
Worked example
With the default values below, Mortgage Payoff Calculator returns Interest Saved of $79,680. Change any input above and every figure here is recalculated in your browser.
Inputs used
- Current Loan Balanceaccepts 1,000–5,000,000 $
- 280,000 $
- Annual Interest Rateaccepts 0–20 %
- 6.5 %
- Remaining Loan Termaccepts 1–40 years
- 27 years
- Extra Monthly Paymentaccepts 0–50,000 $
- 200 $
Results
- Interest Saved
- $79,680
- Years Saved
- 5.8 years
- Months Saved
- 70 months
- Current Monthly Payment
- $1,835.55
- New Monthly Payment
- $2,035.55
- Original Total Interest
- $314,719
- New Total Interest
- $235,040
- New Payoff InPayoff timeline with extra payments applied every month.
- 21y 2m
Step by step
- 1Scheduled monthly payment (P&I)= $1,835.55
- 2New monthly payment with extra= $2,035.55
- 3Original payoff timeline= 324 months
- 4Payoff with extra payments= 254 months (21y 2m)
- 5Time saved= 70 months (5.8 years)
- 6Interest saved= $79,680
Assumptions and limits
- The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
- In particular, this calculator does not take inflation, tax or fees or charges into account.
- Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
- Results are estimates assuming a fixed interest rate and consistent extra payments. Actual savings depend on your lender's application timing and any prepayment restrictions.
- This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.
How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.
Guides that use this calculator
Results are estimates assuming a fixed interest rate and consistent extra payments. Actual savings depend on your lender's application timing and any prepayment restrictions.
Frequently Asked Questions
Does the extra payment go entirely to principal?
Yes — once the month's interest is satisfied, any additional amount reduces the outstanding principal balance directly. Your lender applies the standard payment first (interest then principal) and any extra to principal only.
When should I make the extra payment?
Extra payments save the most when made early in the loan when the balance is highest. Even a single extra payment in the first year can save thousands in interest. Consistent monthly extra payments produce the largest benefit.
Is there a prepayment penalty I should check?
Some mortgages, particularly older ones, include a prepayment penalty clause if you pay off more than a set amount early. Check your loan documents or ask your servicer before making large extra payments.
How does this compare with refinancing?
Refinancing typically lowers your rate and restarts your term, while extra payments keep your rate but shorten the term. Use the Refinance Calculator to compare both strategies side by side.