Early Mortgage Payoff Calculator
Discover how many years you can cut from your mortgage and how much interest you'll save by making extra monthly payments. Enter your remaining balance, rate, and extra payment to see the exact impact.
Last updated: October 2026
Months Saved
66 months
This calculator gives an estimate for general information only. It is not financial, tax or investment advice. Check the figures with a qualified professional before making decisions, and follow the rules that apply where you live.
Formula below · 1 source (CFPB) · Updated Oct 2026
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About this calculator
Your required payment is found with the standard amortization formula:
P = balance × r × (1 + r)ⁿ ÷ ((1 + r)ⁿ − 1)
where r is the annual rate ÷ 12 and n the months left. The calculator then runs the loan month by month with P plus your extra payment: each month interest (balance × r) is added and the payment subtracted, so all of the extra goes to principal. Months saved = the months left minus the new payoff month count. Interest saved = the interest left on the original schedule (P × n − balance) minus the interest actually paid with the extra payment.
Why early extra payments matter most
Interest is charged on the remaining balance, so every dollar of principal you repay early stops costing interest for all the remaining years. The same $200 a month saves far more when 25 years are left than when 5 are.
Before you prepay
Tell your servicer the extra amount is for principal. Most mortgages made since 2014 cannot charge prepayment penalties after the first three years, but check your note. Prepaying is a guaranteed return equal to your mortgage rate; it may make sense to fund an emergency reserve and capture any employer retirement match first. Taxes and insurance in your escrow payment are not included.
How to use
Enter your current balance, interest rate, years left and the extra amount you will add each month. Example 1 (defaults): $250,000 at 6.5% with 25 years left. The required payment is $1,688.02. Adding $200 a month pays the loan off 66 months (5½ years) sooner and saves about $65,000 of interest. Example 2: $200,000 at 6% with 20 years left and $200 extra. Required payment $1,432.86; payoff 49 months sooner, saving about $34,000.
Frequently asked questions
How much interest can I save by paying an extra $100 a month on my mortgage?
It depends on the balance, rate and years left. On a $250,000 balance at 7% with 25 years left, an extra $100 a month pays the loan off 38 months sooner and saves about $42,000 of interest; on a new $300,000 30-year loan at 7% it saves 50 months and about $69,000. The earlier you start, the larger the saving, because interest is front-loaded.
Is it better to make extra mortgage payments or invest that money instead?
The answer depends on your mortgage interest rate compared to your expected investment return after tax. If your mortgage rate is 7% and you expect stock market returns of 7–10% annually, investing may produce better long-term wealth — but investment returns are uncertain while mortgage payoff is guaranteed. Paying extra on the mortgage is a risk-free, tax-free return equal to your interest rate, which is attractive in high-rate environments. Many financial advisors suggest a hybrid approach: build an emergency fund and capture any employer retirement match first, then split extra funds between investing and mortgage payoff.
When does it make sense to refinance instead of making extra mortgage payments?
Refinancing makes sense when current rates are meaningfully lower than your existing rate — typically at least 0.5–1 percentage point lower — and you plan to stay in the home long enough to recoup the closing costs, usually 2–5% of the loan amount. If rates are similar to your current rate, making extra payments achieves interest savings without the upfront cost and paperwork of refinancing. Extra payments also offer flexibility: you can stop them anytime without consequence, unlike a new loan commitment. Compare the break-even period on refinancing against the guaranteed savings from extra payments using both this calculator and a refinance break-even calculator.
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Sources & references
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