What our Mortgage Payoff Calculator does
This calculator shows how changing your payment pattern can shorten your payoff date and reduce total interest on a fixed-rate mortgage. Enter what you know about your loan (either the remaining term or the current balance and payment), then test four payoff strategies: a one-time lump sum, recurring extra monthly or yearly payments, a biweekly schedule (26 half-payments per year), or simply continuing with normal payments. The tool computes a new payoff date, the time saved, and your interest saved compared with doing nothing-then it visualizes the results with charts and an amortization table you can expand.
Why payoff modeling matters
- Interest is front-loaded. Early in a loan, a larger share of each payment is interest. Extra principal now prevents future interest from ever accruing.
- Small changes compound. Even modest monthly extras (e.g., $50–$150) can remove years from a 30-year mortgage.
- Cash-flow fit. You can compare monthly extras vs. one-time lump sums vs. biweekly timing to see which fits your pay schedule and budget.
How to read your results (interpretation & norms)
- Payoff in X years, Y months. This is your new payoff timing under the selected option. Compare it with your original payoff in the table.
- Time saved. Anything above ~2–3 years saved is usually meaningful; biweekly alone on a fresh 30-year mortgage often trims ~4–6 years depending on rate.
- Interest saved. Focus on the dollar amount avoided, not just monthly payment changes. A smaller monthly payment could still increase lifetime interest if it lengthens the term.
- Who benefits most? Borrowers with many years left, higher interest rates, or room for recurring extras. Near the end of a loan, the payoff date barely moves because little interest remains.
- Healthy ranges to test. Monthly extras of 0.5%–2% of the payment (e.g., $10–$60 per $3,000 payment) and lump sums of 1%–5% of the balance are common “what-if” starting points.
Show the math (formulas & steps)
Inputs & conversions
- Monthly rate:
r = APR / 12 - Term in months:
n = years × 12 + months
Monthly payment (PMT) for a fully amortizing loan
PMT = r × P / (1 − (1 + r)^(-n))
Unknown term (NPER) when you only know payment, balance, and rate
n = -ln(1 - r × P / PMT) / ln(1 + r)
Amortization loop (each month)
interest_i = balance_{i-1} × r
principal_i = PMT - interest_i
extras_i = monthlyExtra + (yearlyExtra if i%12==0) + (oneTime at i==1)
balance_i = max(0, balance_{i-1} - principal_i - extras_i)Biweekly option is modeled as effectively one additional monthly payment per year:PMT × 13 / 12 distributed across months.
Totals
- Total payments = (number of paid months) × PMT + extras
- Total interest = total payments − original principal
Assumptions & limitations
- Fixed-rate, fully amortizing mortgage with on-time payments.
- Property taxes, insurance, HOA dues, PMI, and escrow changes are not modeled.
- Prepayment penalties are not applied; check your note if your loan is newer or non-conventional.
- Results are estimates; actual lender rounding and cutoff dates can shift by a payment.
Step-by-step: get the most from the tool
- Choose the mode that matches what you know (remaining term or current balance + payment).
- Confirm your APR and payment from your latest statement.
- Toggle a payoff strategy and experiment with amounts that fit your budget.
- Open the amortization table to see where interest falls and when the balance hits zero.
- Use “Copy link with inputs” to save or share the exact scenario.
Worked examples
- Small monthly extra - $350,000 at 6% with 27 years left. Adding $150/month can cut ~3.1 years and save roughly $45,000–$55,000 in interest (range depends on timing).
- Biweekly cadence - $2,200 standard monthly payment becomes $1,100 every two weeks. That’s 13 “full” payments per year, typically shaving 4–6 years off a 30-year term at common rates.
- Lump sum - A $10,000 one-time prepayment on a fresh loan drops future interest immediately; early in the term this can remove several months and thousands in interest. Late in the term the effect is smaller, because little interest remains to avoid.
Who this calculator is for
- Homeowners with fixed-rate mortgages who want a guaranteed return equal to their mortgage rate.
- Borrowers deciding between extra payments, a refinance, or investing surplus cash.
- People who are planning for retirement and want debt gone on a specific date.
Next steps
- Try a range of extras (e.g., $50, $100, $150/month) to see the payoff curve bend.
- Open the amortization table and scroll to the month where your balance hits zero.
- Use “Copy link with inputs” to save the scenario and revisit it later.