Enter your balance, rate and extra payments to find your debt-free date and interest saved.
Payoff strategies, ranked
Not all extra payments are equal. The most powerful move is a recurring extra monthly payment toward principal: on a $250,000 balance at 6%, adding $300 a month cuts the payoff from about 197 months to 158 and saves over $31,700 in interest. A lump sum (bonus, tax refund) helps too, but one-time payments do less compounding work than steady ones. A biweekly schedule is effectively one extra payment a year. Refinancing to a shorter term also accelerates payoff, but only if the new rate justifies the closing costs — use our refinance calculator to check the breakeven first.
Watch for prepayment penalties
Most modern US mortgages have no prepayment penalty, but some do — typically a percentage of the balance if you pay off within the first 2–5 years, or a cap on extra principal per year (often 20%). Check your loan documents or ask your servicer two questions: is there a prepayment penalty, and are extra payments applied to principal immediately? If extra money sits in a suspense account instead of reducing principal, you lose the compounding benefit this calculator assumes.
Pay off early or invest instead?
Paying extra on a 6–7% mortgage is a guaranteed, risk-free return equal to your rate — hard to beat. The tradeoff is liquidity: money in your walls is not available for emergencies or opportunities. A balanced rule: keep 3–6 months of expenses liquid, capture any 401(k) employer match first (an instant 50–100% return), then weigh extra mortgage payments against expected market returns and your comfort with debt. There is no universal right answer — only the one that fits your risk tolerance and timeline.
How is this different from the extra-payment calculator?
This calculator starts from your current balance and payment and finds your debt-free date, with a year-by-year table. The extra-payment calculator compares loan scenarios from origination. Use this one when you already have a mortgage and want a payoff plan.
Will my lender charge a prepayment penalty?
Most US mortgages originated in recent years have none, but check your note: some loans penalize payoff within 2–5 years or cap extra principal at ~20% per year. Your servicer can confirm in one call.
Should I pay off my mortgage early or invest the money?
Extra mortgage payments earn a guaranteed return equal to your interest rate. Investing may earn more long-term but carries risk. Keep an emergency fund and capture any 401(k) match before choosing.
Does an extra payment reduce my monthly payment?
No — extra principal shortens the loan term; your required monthly payment stays the same until the loan is paid off. To lower the payment itself you would need to refinance or recast the loan.
What happens if I skip the extra payment one month?
Nothing bad — you simply lose that month’s acceleration. The loan continues on its normal schedule. Consistency matters more than perfection: even 9 extra payments a year beats none.