Extra Payment Calculator
See how even a small extra monthly payment dramatically shortens your loan and saves thousands in interest. Results update instantly as you type.
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2 Extra Monthly Payment
Try $100, $200, or $500 to see the impact.
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How Extra Mortgage Payments Work
Making extra payments on your mortgage is one of the most powerful ways to build home equity and reduce the total cost of your loan. Because mortgage interest is calculated on your remaining balance, every dollar of extra principal you pay today permanently reduces the balance on which future interest accrues.
On a $320,000 mortgage at 6.875% for 30 years, adding just $200/month in extra principal payments typically saves over $65,000 in interest and cuts roughly 5–6 years off the loan. Increasing that to $500/month can save more than $120,000 and reduce the term by nearly 10 years.
Tips for Extra Payments
- Specify 'principal only' — when making extra payments, confirm with your lender that the extra amount reduces principal, not pre-pays future interest.
- Round up your payment — rounding a $1,847 payment to $2,000 is a painless way to add $153/month toward principal.
- Apply windfalls — tax refunds, bonuses, or gifts applied as lump sums have the same compounding effect as consistent extra payments.
- Compare to refinancing — if your rate is already competitive, extra payments may outperform refinancing once you factor in closing costs.
Use the Refinance Calculator to compare whether lowering your rate or making extra payments on your current loan produces better lifetime savings.
Frequently Asked Questions
How much do extra mortgage payments save?
On a $350,000 30-year loan at 6.5% (payment $2,212), adding $200 a month to principal pays the loan off about 6 years early and saves roughly $108,000 in interest. The earlier in the loan you start, the larger the saving, because early payments are mostly interest.
Is it better to make extra payments or invest the money?
An extra payment earns a guaranteed return equal to your mortgage rate. If your rate is 6–7%, that compares well with after-tax investment returns. At a 3% rate, investing usually wins over the long run. Build an emergency fund and capture any employer 401(k) match first.
Do extra payments lower my monthly payment?
No. On a standard fixed-rate mortgage the required payment stays the same and the loan ends earlier. To lower the payment you would need a recast, where the lender re-amortizes the loan after a large lump-sum payment, usually for a small fee.
Will my lender charge a prepayment penalty?
Most conventional, FHA, VA and USDA loans have no prepayment penalty. Some non-qualified mortgages do. Check the 'Prepayment penalty' line on your Loan Estimate or Closing Disclosure.