Mortgage Extra Payment Calculator: How Much Will You Save?
Small extra payments toward principal can take years off a mortgage. See exactly how much time and interest you would save.
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Extra Payments on a $300,000 Mortgage
A $300,000, 30-year loan at 6.5% (payment $1,896.20):
| Extra each month | Paid off in | Interest saved |
|---|---|---|
| $50 | 27 yrs 10 mo | $33,582 |
| $100 | 26 yrs 0 mo | $60,995 |
| $200 | 23 yrs 1 mo | $103,449 |
| $500 | 17 yrs 6 mo | $179,759 |
| $1,000 | 12 yrs 9 mo | $241,162 |
Extra payments work so well because every dollar of principal you repay early stops collecting interest for the rest of the loan.
Biweekly Payments
Paying half your mortgage every two weeks gives 26 half-payments a year — the same as 13 full payments instead of 12. On the loan above, that one extra payment a year cuts the term to about 24 yrs 2 mo. Only use a biweekly plan your servicer runs for free; you can get the same result by adding 1/12 of a payment each month.
Before You Pay Extra
- Make sure extra money is applied to principal, not held for next month’s payment. Most servicers have a “principal only” option.
- Check for a prepayment penalty. Since 2014, federal rules ban them on most US mortgages and cap them on the rest.
- Keep an emergency fund and pay off higher-rate debt (like credit cards) first — that usually saves more than mortgage prepayment.
- Prepaying does not lower your monthly payment unless you ask the lender to recast the loan.
Frequently Asked Questions
Is it better to pay extra on a mortgage or invest?
Prepaying earns a guaranteed return equal to your mortgage rate. If your rate is high, prepaying is attractive; if it is low, long-term investing may earn more, with more risk.
Does one extra mortgage payment a year help?
Yes. On a 30-year loan at 6.5%, one extra payment a year cuts about 5–6 years off the term.
Should extra payments go to principal or escrow?
Principal. Payments to escrow only cover taxes and insurance and do not reduce your loan.
Can I make a lump-sum payment?
Yes. Enter it as a one-time extra payment above to see the effect. Some lenders will recast the loan afterward to lower your monthly payment for a small fee.