📘 About This Calculator

This calculator shows exactly how much time and interest you'll save by making extra payments toward your mortgage principal. Compare strategies — extra monthly, biweekly, or a lump sum — and see whether paying down your loan actually beats investing the same cash in the market.

🎯 Strategies Compared

Extra Monthly Payment

Add a fixed amount to every monthly payment. Even $100/month on a 30-year loan can shave 3-5 years and save tens of thousands in interest.

Biweekly Payments

Pay half your monthly payment every two weeks. Because there are 26 biweekly periods, you make one extra full payment per year — a "painless" acceleration.

Lump Sum

A single one-time principal payment (e.g. tax refund, bonus, inheritance). Most effective early in the loan, when your payments are heavily interest-weighted.

Pay Off vs Invest

Compares the guaranteed "return" from saving mortgage interest against investing the same extra dollars at a market rate. Your mortgage rate is the hurdle — beat it, and investing wins.

💡 When Early Payoff Makes Sense

⚠️ When Investing Beats Payoff

🏦 Current Mortgage

Years left on the current amortization schedule
Leave at 0 to auto-calculate from balance, rate, and term

⚡ Accelerator Strategy

📊 Invest Instead?

Compare paying down the mortgage against investing the same extra dollars at a market return.

Based on S&P 500 avg annual return 2016-2025

💡 Quick Rule

If your expected after-tax investment return exceeds your mortgage rate, investing wins. If not, or if peace of mind matters, accelerated payoff is the guaranteed "return."

Savings Summary

Enter your loan details to see savings

Balance Over Time

Enter your loan details to see chart

Annual Amortization

Enter your loan details to see schedule

Payoff vs Invest

Enter your loan details to see comparison

How the Mortgage Payoff Calculator Works

This calculator shows the two numbers that really matter when you throw extra money at a mortgage: how many years you shave off the loan and how much total interest you avoid paying. It then puts those savings up against what the same money would have earned in an investment account, so you can see whether paying down the mortgage is actually the better move for your rate.

Four ways to pay off faster

  1. Extra monthly principal — the simplest. Add a fixed amount to every payment. On a $300k loan at 6.5%, an extra $200/month pays it off ~5 years early.
  2. Biweekly payments — pay half your mortgage every two weeks. Because there are 26 half-payments in a year, you make the equivalent of 13 monthly payments instead of 12. Typically shaves 4–6 years off a 30-year term.
  3. Annual lump sum — tax refund, bonus, or a quarterly bonus channeled straight to principal.
  4. Round-ups — round your payment up to the next $50 or $100. Small, invisible, and consistent.

Why extra principal is so powerful early

On a 30-year loan at 6.5%, about 71% of your first payment is interest. Every dollar of extra principal applied in Year 1 wipes out the ~6.5% interest it would have accrued for the next 29 years. That's why an extra $100 in Year 1 saves roughly the same as $300 in Year 20.

Core formulas

Standard monthly P&I:

P = L × c(1 + c)n / ((1 + c)n − 1)

Each month, the lender collects interest first (Balance × c) and whatever's left reduces the principal. Any extra you pay goes 100% to principal, so next month's interest is calculated on a smaller balance — the compounding engine, run in reverse.

Pay off early vs. invest the difference

Paying extra principal earns you a guaranteed, risk-free return equal to your mortgage rate. If your rate is 7.5% and you'd otherwise invest in a high-yield savings account at 4.5%, paying down the mortgage wins every time. If your rate is 3.25% (think 2020 refinance) and you'd invest in a diversified portfolio you believe averages 7–9%, investing the difference almost always wins over long horizons. The calculator shows both scenarios on the same chart so you can see the crossover for your rate and expected return.

Worked example

Things to watch out for

Frequently asked questions

Are biweekly mortgage payments worth it?

Yes, in most cases. Paying half your mortgage every two weeks results in 26 half-payments per year, which is the equivalent of 13 full monthly payments — one extra each year. That typically shaves 4–6 years off a 30-year mortgage and saves tens of thousands in interest, without any change to your monthly budget.

Should I pay off my mortgage early or invest?

If your mortgage rate is higher than your expected after-tax investment return, paying it down wins. If your rate is lower and you're comfortable with market risk, investing usually wins long-term. The calculator shows both scenarios side by side so you can see the crossover for your specific rate and expected return.

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

On a typical $300,000, 30-year loan at 6.5%, paying an extra $200/month pays the loan off about 5 years early and saves roughly $70,000 in interest. The exact numbers depend on your rate and remaining balance — the calculator computes it for your inputs.

Should I recast my mortgage or make extra payments?

Extra payments shorten the term but keep the required monthly payment the same. A recast re-amortizes the loan over the original term after a lump-sum payment, which lowers your required monthly payment but keeps you paying for 25–30 years. Choose extra payments to be debt-free faster; choose recast to free up monthly cash flow.

Does paying extra reduce my monthly payment?

No. Extra payments reduce the principal balance (and therefore the total interest and loan length), but your required monthly payment stays the same unless you recast. If lower monthly payments are your goal, ask your servicer about recasting.

Related calculators