Mortgage Prepayment Calculator
Add an extra payment to your mortgage and instantly see how many years you cut, how much interest you save, and how the payoff date moves.
About this tool
A focused mortgage prepayment calculator. Layer extra monthly principal, an annual lump sum, or a one-time windfall onto any 15- or 30-year mortgage and watch the payoff date jump back years.
How to use it
Quick steps to get the most out of this utility.
- 1
Enter mortgage details
Loan amount, interest rate, term. Use the original loan info to model the full lifetime impact.
- 2
Add extra principal
A common pattern: an extra $100–$300 per month, or one extra payment per year.
- 3
See the new payoff date
The calculator shows your revised end-of-loan month and total interest saved.
- 4
Compare strategies
Try "biweekly payments" (26 half-payments = 13 monthly payments per year) vs a yearly lump sum.
- 5
Export & schedule
Download the schedule and set the extra payment as an automatic transfer.
The math of "one extra payment a year"
A single extra principal payment per year is the highest leverage prepayment habit in personal finance. On a 30-year mortgage, you finish 4–6 years early and save 15–25% of total interest, all from one extra payment annually. The reason is compounding in reverse — each rupee of principal removed today permanently removes the interest it would have accrued for the remaining tenure.
Three sustainable prepayment patterns
- Round up: pay $1,750 on a $1,683 mortgage. Almost painless monthly, ~3 years saved.
- Tax refund route: apply your IRS refund to principal every spring.
- Bonus split: 50% of every year-end bonus goes to mortgage, 50% to taxable investments.
Frequently asked questions
Does paying extra principal really save that much?+
On a 30-year, $400,000 mortgage at 7%, paying an extra $300/month cuts the loan by roughly 9 years and saves over $180,000 in interest. The reason it works is structural: front-loaded interest. Most of your early payments are interest — extra principal in years 1–10 has dramatically more impact than the same payment in years 20–30.
Should I prepay my mortgage or invest the difference?+
Compare your mortgage rate to your expected after-tax investment return. With current 7% mortgage rates, prepayment is a guaranteed 7% "return" that beats most fixed income. At 3% mortgage rates (the 2020 vintage), investing the difference makes more sense for long horizons. The honest answer also depends on whether you would actually invest the surplus or spend it.
What is biweekly payment and does it work?+
Instead of 12 monthly payments per year, you pay half your mortgage every two weeks — which produces 26 half-payments = 13 full payments per year. That one extra payment, applied to principal, shaves roughly 4–6 years off a 30-year mortgage. Many lenders will set this up free; avoid paid biweekly services that charge to do the same thing.
Are there prepayment penalties on US mortgages?+
On standard conforming mortgages (Fannie/Freddie), no — federal rules largely banned prepayment penalties on qualified mortgages. Some non-QM, jumbo, or older subprime loans may have penalties for the first 1–3 years. Check the truth-in-lending disclosure and the note before prepaying large amounts.
How do I make sure my extra payment goes to principal?+
Most lenders default extra payments toward the next month's interest unless you specifically request "principal only." Use your lender's online portal or write "PRINCIPAL ONLY" on a paper check. After the first extra payment, verify on the next statement that the principal balance dropped by the full extra amount.
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More views of the same calculator
Open main calculator →Same underlying engine, written for different use cases. Pick the angle that matches your situation.