Mortgage Payoff Calculator

Enter your balance and rate, plus either your remaining term or current payment, then add extra monthly, one-time, or biweekly payments to see how much sooner you'll be mortgage-free and how much interest you'll save.

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How early mortgage payoff works

Every month, your lender takes interest on whatever you still owe, and only the remainder of your payment reduces the balance. Anything you pay beyond the required amount skips the interest line entirely and goes straight to principal — and principal that's gone stops generating interest for every remaining month of the loan. That's why an extra dollar in year 1 of a 30-year mortgage is so much more powerful than the same dollar in year 25: it cancels nearly three decades of compounding against you instead of a few years. This calculator runs your loan month by month, twice — once as-is, once with your extra payments — and shows you the gap. For shopping a new loan rather than attacking an existing one, use the mortgage calculator; for non-mortgage debt, the loan calculator.

The formula

M = P × r(1 + r)n ÷ ((1 + r)n − 1)

M is the monthly principal-and-interest payment, P the current balance, r the monthly rate (annual rate ÷ 12 ÷ 100), and n the months remaining. If you enter your payment instead of your term, the calculator solves for n. The payoff comparison itself isn't a single formula — it's a month-by-month simulation: interest = balance × r is added, then your payment (plus any extras) is subtracted, until the balance hits zero. Biweekly payments are modeled the standard way: 26 half-payments a year equals 13 full payments, which the simulation applies as an extra 1/12 of your payment every month.

Worked example

A $300,000 balance at 6.5% with 30 years remaining has a payment of $1,896.20 and would cost $382,633.47 in interest.

Add $200 extra per month: the loan pays off in 23 years, 1 month — 6 years, 11 months sooner — with total interest of $279,184.67. That's $103,448.79 saved, a 27% discount on the interest bill, for about the price of a weekly takeout order.

The biweekly trick, demystified

Biweekly plans sound like financial engineering, but the entire magic is a calendar quirk: there are 26 two-week periods in a year, so paying half your mortgage every two weeks means 13 full payments instead of 12. That's it. On the $300,000 example above, biweekly payments alone pay the loan off 5 years, 10 months sooner and save about $87,256 — with money you'd barely notice leaving. Which is why you should never pay for it: some banks and third parties charge enrollment fees ($300+) plus per-transaction fees for a "biweekly program" you can replicate for free by adding 1/12 of your payment to each month's check, or simply making one extra full payment a year. Same math, zero fees.

When you should not prepay

Extra mortgage payments are a guaranteed, tax-free return equal to your interest rate — but that's not always the best move. If your rate is 3% and high-yield savings pay 4.5%, prepaying locks money into the lower return (see the compound interest calculator for what the alternative earns). If you don't have 3–6 months of expenses saved, build that first: money sent to the mortgage is hard to get back in an emergency. And any credit card or personal loan charging more than your mortgage rate should be attacked first. Prepaying a mortgage is a good habit; it's just fourth in line behind emergency savings, employer 401(k) match, and higher-rate debt.

Frequently asked questions

What happens if I pay an extra $200 a month on my mortgage?

On a $300,000 balance at 6.5% with 30 years remaining, an extra $200 a month pays the loan off 6 years, 11 months sooner and saves about $103,449 in interest. The earlier in the loan you start, the bigger the effect, because every extra dollar of principal stops accruing interest for the entire remaining term.

Is a biweekly mortgage payment plan worth it?

The math is real: 26 half-payments a year equals 13 full payments, and on a $300,000 loan at 6.5% that alone pays off 5 years, 10 months sooner and saves roughly $87,256. But never pay a bank or third party to set it up — you get identical results for free by adding 1/12 of your payment to each monthly check or making one extra full payment a year.

Should I pay off my mortgage early or invest instead?

Prepaying is a guaranteed, tax-free return equal to your mortgage rate; investing usually earns more over long periods but with no guarantee. If your rate is above 6-7%, prepaying is hard to beat risk-free. If it's 3-4%, index funds or even savings accounts have historically come out ahead. Many people split the difference — and the peace of mind of a paid-off house is a legitimate return too.

Do extra mortgage payments automatically go to principal?

Not always. Some servicers hold extra money as a prepayment of your next bill unless you tell them otherwise. When you pay extra, mark it "apply to principal" (most online portals have a checkbox), then verify on your next statement that the balance dropped by the full extra amount.

Does paying extra lower my monthly mortgage payment?

No — your required payment stays the same; the loan just ends sooner and costs less interest. The exception is a recast: after a large lump-sum payment, some lenders will re-amortize the loan over the original term for a small fee, which lowers the monthly payment instead of shortening the term.

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