Extra payment calculator

Frequently asked questions

Does the extra payment have to go toward principal to work as shown?

Yes. The savings calculation assumes the extra amount reduces the outstanding principal balance each month rather than being held as a credit toward future scheduled payments. When making extra payments, confirm with your servicer that the funds are applied to principal immediately, as policies vary by lender.

Why do even small extra payments save a lot of interest?

Early in a mortgage, most of each scheduled payment covers interest rather than principal. An extra principal payment skips that interest by permanently lowering the balance on which future interest accrues, and the effect compounds across every remaining period.

Is the interest saving guaranteed?

No. The estimate assumes a fixed interest rate and consistent extra payments for the life of the loan. Changes to the rate (on adjustable loans), missed payments, or refinancing will alter the actual outcome.

What happens if I make the extra payment only occasionally?

The calculator models a consistent monthly extra payment. Occasional lump-sum payments also reduce interest and shorten the payoff timeline, but the relationship is not directly proportional — a one-time payment early in the loan saves more than the same amount paid later, because the balance accrues interest for fewer remaining periods.