Extra Payment Calculator
See how adding a little extra to your mortgage each month can shave years off the loan and save thousands in interest.
By Onias Derilus, Mortgage Capital · NMLS# 1859012 · Last Updated: June 2026
Applying extra dollars to principal each month shortens the loan and removes future interest. Confirm your servicer applies extra payments to principal. Estimate only.
Every extra dollar you put toward principal removes the future interest that dollar would have generated for the rest of the loan. That is why even a modest extra payment can have an outsized effect.
The earlier you start, the bigger the impact, because there is more remaining term over which the saved interest compounds in your favor.
How to Use This Calculator
- 1
Enter your loan amount, rate, and original term.
- 2
Add the extra amount you could pay toward principal each month.
- 3
Review how many years come off the loan.
- 4
Check the total interest saved to decide whether the trade-off fits your budget.
The Formula & Assumptions
New payment = base P&I + extra
Each month:
balance += balance × monthly rate
balance −= new payment
Count months until balance = 0
We compute your normal principal-and-interest payment, add your extra contribution, then simulate the loan month by month until the balance reaches zero.
The interest saved is the difference between total interest on the original schedule and total interest once the loan pays off early.
Tell your servicer to apply extra payments to principal, not to prepay the next month. Confirm there is no prepayment penalty — most modern conforming loans have none.
Frequently Asked Questions
Is it better to make extra payments or refinance?
They solve different problems. Extra payments shorten the loan without changing your rate, while refinancing lowers the rate but resets the term. If rates have dropped meaningfully, compare both with the refinance calculator.
When should I start making extra payments?
As early as possible. Extra principal applied in the first years removes interest for the longest remaining period, so the same dollar saves far more early than it would late in the loan.
Will my lender penalize extra payments?
Most conforming and government loans have no prepayment penalty, but some non-QM and investor loans do. Check your note, and confirm with your servicer that extra funds are applied to principal.
Should I pay off the mortgage or invest instead?
It depends on your rate, risk tolerance, and goals. Paying down a higher-rate mortgage is a guaranteed return equal to the rate, while investing carries risk and potential upside. Consider both with a financial professional.
Ready to Turn Your Estimate Into a Real Pre-Approval?
Get a personalized rate quote and pre-approval from a licensed Florida mortgage broker — no obligation.
Rates are illustrative only. APR and payments vary by credit score, loan amount, and market conditions. Subject to credit approval. Not a commitment to lend. NMLS# 1859012. Equal Housing Lender.