Mortgage Payoff Calculator
See how extra payments shorten your loan and save interest.
Pay Off Your Mortgage Early
Making extra principal payments on your mortgage reduces the outstanding balance faster, so you pay less interest over the life of the loan and can own your home sooner. Even a small extra amount each month—$100, $200, or one extra payment per year—can cut years off a 30-year loan and save tens of thousands in interest. Our mortgage payoff calculator shows exactly how many months you save and how much total interest you avoid when you add a fixed extra payment every month.
How extra payments work
Your regular monthly payment is split between principal and interest. Early in the loan, most of the payment goes to interest. When you pay extra toward principal, the balance drops, so next month’s interest is calculated on a smaller amount. That means more of each future payment goes to principal, creating a snowball effect. Specify “principal only” when making extra payments so the lender does not treat them as early next-month payments.
When paying off the mortgage early makes sense
Paying off the mortgage early is appealing if you value being debt-free, if your mortgage rate is higher than your expected investment return, or if you are close to retirement and want to reduce fixed expenses. On the other hand, if your mortgage rate is low and you can earn a higher after-tax return elsewhere, investing the extra cash may build more wealth. Run the numbers here and compare with your mortgage calculator baseline, then consider how it fits into your big picture with our retirement income calculator and retirement calculator.
Mortgage Payoff FAQ
Extra principal payments reduce the amount of interest you pay and shorten the loan term. Even $100–200 per month can save thousands and cut several years off a 30-year mortgage. This calculator shows the exact months to payoff, total interest paid, and how many months you save compared with no extra payment.
It depends on your mortgage rate, expected investment return, and risk tolerance. If your mortgage rate is higher than what you expect to earn after tax on investments, paying down the mortgage is a guaranteed “return.” If you have a low rate and a long time horizon, investing may yield more. Many people do a mix of both.
Most lenders do. When you make an extra payment, specify that it is for “principal only” or “principal reduction” so it is applied to the loan balance and not to future payments. Check your loan servicer’s website or call to confirm how to submit principal-only payments and that there are no prepayment penalties.
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