This mortgage payoff calculator shows how much sooner you can be mortgage-free by paying extra each month or making a one-time lump-sum payment, and how much interest you save.
Why extra payments work
Interest each month is charged on the remaining balance. Extra money goes straight to principal, so every later month is charged less interest, and more of your regular payment goes to principal too.
Worked example
A $250,000 balance at 6.5% with 25 years left has a payment of about $1,688.02. Adding $200 a month pays it off in 19 years 6 months, about 5 years 6 months sooner, and saves about $64,928 in interest.
Frequently asked questions
Is it better to pay off the mortgage or invest?
Paying extra gives a guaranteed return equal to your mortgage rate. Investing may earn more but carries risk. Many people first build an emergency fund and pay off higher-rate debts.
Are there prepayment penalties?
Most US mortgages today do not have them, but some loans and many UK and Canadian mortgages limit overpayments. Check your agreement.