Pay off your home loan sooner
See when your home loan will be paid off and how much interest you will pay. Then try an extra payment, a lump sum or paying every two weeks, and watch the date move.
Your loan is paid off in
less interest
sooner
Interest you will pay
A payoff quote adds the interest owed up to the payoff day and any small fees. Ask your servicer for one when you are ready to pay the loan off.
Interest To the balance
Interest is figured on what you still owe. At the start you owe the most, so interest is the biggest part. Each payment shrinks the balance, so the split slowly turns around.
Estimates only, not a quote, offer, pre-approval, or commitment to lend. Talk to Scott for your actual terms.
Your amortization schedule
| Year | To the balance | Extra | Interest | Balance left |
|---|
Tap a year to see its months. "To the balance" is the part of the regular payment that pays down the loan; "Extra" is what you add on top.
How we got your number
Your payoff, worked out one month at a time with your numbers. Change anything above and these steps change too.
New to this? Start here
Six short parts, in the order you need them. Then try the calculator above with your own numbers.
Each month the lender charges interest on what you still owe. At the start you owe the most, so most of your payment is interest and only a little pays down the loan. Each payment shrinks the balance a bit, so the next one sends a bit more to the loan. That is why the balance drops slowly at first and fast at the end.
Money you pay on top of your payment skips the interest. It all comes off what you owe. A smaller balance means less interest next month, and the month after, and every month to the end. That is why a small extra, paid early, saves so much.
Add a little each month. Pay once a year from a tax refund or a bonus. Pay a lump sum once, like money from a sale. Or pay half your payment every two weeks, which adds up to one extra payment a year. You can mix them, and the calculator above takes all four.
Paying extra does not lower your monthly payment. The loan just ends sooner, and you can stop paying extra in any month. If you want a lower payment after a big lump sum, ask your servicer (the company you pay each month) for a recast. They figure a new payment on the smaller balance. There is often a small fee, and FHA and VA loans usually cannot be recast.
A refinance replaces your loan with a new one. It can change your rate, your years, or both, but it has closing costs. If rates have dropped since you got your loan, or you want to move from 30 years to 15, run the refinance calculator next to this one. Choosing your loan walks through the loan types.
First, check your promissory note (the loan papers you signed) for a prepayment penalty. Most home loans made today have none, and FHA and VA loans do not allow one. Second, mark the money as extra principal, then check your next statement to see that it came off the balance. Last, look at the whole picture. Many people build an emergency fund and pay off higher rate debt first, because money in a home is hard to get back out. This is general information, not advice for you.
Next steps
I am licensed in both real estate and mortgage lending, and I take only one role on any single transaction, never both on the same home. You are always free to choose your own agent and lender. See how I work.
This content is for general information only. It is not legal, tax, investment, or financial advice. Consult a qualified professional for guidance specific to your situation.
I update these from one file, so every calculator on the site uses the same numbers.
Questions, answered
Still stuck on something? Call me at (435) 590-1019 and I will walk you through it.
About these estimates
Estimates only. This is not a quote, offer, pre-approval, or commitment to lend. Figures are illustrative and depend on the assumptions you choose.
This tool is for general information only. It is not legal, tax, investment, or financial advice. Consult a qualified professional for guidance specific to your situation.
It lists every payment on your loan. Each payment is the same, but the split changes. Early on, most of it is interest. As the balance goes down, the interest goes down too, so more of each payment goes to the balance. By the end, almost all of it does.
Pay more than the payment. You can add a little each month, pay once a year from a bonus or tax refund, make a lump sum, or pay every two weeks. Every extra dollar goes to the balance, so the next month has less interest, and the loan ends sooner.
No. On most home loans the payment stays the same, and the loan simply ends sooner. To lower the payment after a big lump sum, you would ask your loan servicer for a recast.
A recast is when you pay a lump sum and your servicer figures a new, lower payment on the smaller balance. The rate and the end date stay the same. Most servicers charge a small fee and ask for a minimum lump sum. Many conventional loans allow it. FHA and VA loans usually do not. Ask your servicer.
They do different jobs. A recast keeps your rate and lowers the payment after a lump sum, with a small fee and no new loan. A refinance is a new loan with a new rate and closing costs. If your rate is already low, a recast keeps it.
Paying half the payment every two weeks adds up to 26 half payments, which is 13 full payments a year instead of 12. That one extra payment is what pays the loan off sooner. You can get almost the same result by adding one twelfth of your payment each month. Some companies charge a fee to set up a biweekly plan, so ask first.
Most home loans made today do not. FHA and VA loans do not allow them. Federal rules limit them on most other home loans to the first few years. Your promissory note says for sure, so check it or ask your servicer before you send a large payment.
Mark it as extra principal, online or on the coupon. Then check your next statement. If the servicer put it toward next month's payment or into escrow, call and ask them to move it.
No. Escrow pays your property tax and home insurance, and those bills do not change when you pay the loan down. This calculator works on principal and interest only, so leave escrow out of the payment you type.
Your balance is what you owe today. Your payoff amount adds the interest owed up to the day the loan is paid, plus any small fees. To close out a loan, ask your servicer for a written payoff quote.
A 15 year loan usually has a lower rate, so it costs less interest. A 30 year loan with extra payments costs more interest, but you can drop back to the lower payment in a tight month. Try both in the "A new loan" view of this page to see the gap with your numbers.
It depends on your whole picture. Many people first build an emergency fund, pay off debt with a higher rate, like a credit card, and take any retirement match from work. Money paid into a home is hard to get back out without selling or borrowing. This content is for general information only. It is not legal, tax, investment, or financial advice. Consult a qualified professional for guidance specific to your situation.
If you itemize and deduct mortgage interest, paying less interest means a smaller deduction. For many people the interest saved is still more than the tax lost. A tax professional can tell you how it works for you.
No. It is a close estimate. Your servicer figures interest on your real balance, and your loan may count days a little differently. Your monthly statement and a payoff quote show the exact numbers.
Talk to a real lender
This page makes a good guess. For your real rate, payment and cash to close, talk to me, Scott Buehler, the mortgage lender behind this calculator. I will run your numbers for free, and you are under no obligation.
Scott Buehler, mortgage lender, NMLS #1794818. Guild Mortgage Company, NMLS #3274.