Early Loan Payoff Calculator

Early Loan Payoff Calculator

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Our Mortgage Payoff Calculator tells how much to add to monthly payments to reduce your loan term and how soon you will pay off your home loan. 

Accelerate Your Mortgage?

While some financial experts caution against paying off a mortgage early (money once given to a lender isn't always easily gotten back if or when you need it), if you have extra cash on hand and don't like debt, reducing or eliminating your mortgage more quickly than the agreed upon schedule may give you the peace of mind or breathing room in your budget when you are older.

Early Payoff Calculator


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How to use the Early Payoff calculator

Here's how it works: You input your original mortgage balance, the original term and interest rate. Then figure out how many month's of payments you've already made. Finally, decide how soon you'd like to have your mortgage paid off. For example, a couple in their 40's may decide that they'd like to pay off the 30-year loan they took out last year in 20 years. They input the particulars of their current loan, put in a new term of 20 years, and the Early Payoff Calculator determines how much extra they need to pay each month to make that happen.

Refinance Your Mortgage?

But adding extra to your payment each month isn't the only way to accelerate a mortgage. Refinancing to a shorter term might be a better way if you can get a lower mortgage rate. Interest rates are near historical lows.

Paying your mortgage early by refinancing to a 15 year loan reduces your interest expense because 15-year rates are lower than 30-year rates, and a 15-year loan also accelerates your loan payoff.

Using our Mortgage Refinance Calculator allows you to compare the payment on a new 15-year mortgage to the payment on the Early Payoff Calculator.  You might be able to retire the loan even faster or pay less each month by refinancing.

Mortgage calculators are invaluable tools for helping you with your financial planning. And prepaying or refinancing your mortgage now may make your finances a lot more comfortable in the future.

39 Responses to "Early Loan Payoff Calculator"
  1. mark 06, Oct, 2008

    loan amount: does this mean total amt currently owed to bank? Please define "no. of payments made"? - - - EDITOR'S COMMENT: Good questions. Loan Amount refers to the original amount of the loan. "Number of Payments Made" ("No." is an abbreviation for "Number") refers to the number of payments you have already made on the loan from the time you took out the loan until today. "New Loan Trm" refers to what you want the new repayment period to be, from the month in which you originally took out the loan out until the day it will be fully repaid.

  2. Cathy 05, Aug, 2008

    If I make a lump sum payment of say $10,000.00 on my mortgage will that reduce the amount of interest I pay each month, making more of monthly payment go to principal? Thanks - - - EDITOR'S RESPONSE: In many cases, yes, but check with your lender, and read your loan paperwork carefully. Some loans are less hospitable to lump sum payments than others. And either way, you'll want to coordinate the application of your payment with your lender. I've seen cases where someone made a lump some payment, and a clerk at the lender's institution entered it as advance payment of the next three month's mortgage. This did them no good at all. It's important to A) review your paperwork to see whether lump sums will be applied 100% to principal and B) check the paperwork to see whether there is any early payoff penalty (yes, some loans actually carry a penalty for paying them off early), C) call your lender before you send the payment to make sure they understand what to do with it, and C) call your lender or check your account online after you send the payment to make sure that your principal was reduced by the appropriate amount. It sounds like a lot, but it won't take more than a couple of hours when all is said and done, and it's worth it :-)

  3. Barbara Jones-Calculator 19, Jul, 2008

    Hi, Is there a calculator that will show me how long it will take if I make extra principal payments? - - - - EDITOR'S COMMENTS: We have an "Additional Payments Calculator" that can help you, but you'd have to play around with it for awhile to get the information you're looking for, because it approaches the question like this: "To pay off my mortgage by a given early payoff date, how much extra do I need to pay each month?" We've had a number of people indicate that they want to approach this from the angle: "If I pay $X extra every month, how much sooner will I repay the loan." In response, we will begin development of this type of calculator. In the meantime, use the Additional Payments Calculalator, adjusting the payoff date until the dollars per month mirrors the amount you are interested in paying extra each month.

  4. TM 01, Jul, 2008

    Used the calculator to look at student loans and early pay off. Interest is not tax deductable due to income level. Thanks for the calc.

  5. Mark 13, Jun, 2008

    Over the years people always talked about making one extra principal payment a year and you can pay your mortgage off in half the time. I just used your calculator and it states that I need to make extra payments of 1/3 of the payment amount every month to payoff the loan early, what gives? - - - - EDITOR'S COMMENTS: It depends on our interest rate, of course. At 7% annual interest on a 30-year fixed rate mortgage, if you, from day one, increase every payment by 35%, you'll pay off your loan in 15 years, curring the repayment period in half. If you had a high-interest rate loan, like we were seeing in the 1980s, so you had a 30-year fixed rate at 12% Interest rate, you would only have to increase each payment by 17% to pay it off in half the time. The higher your interest rate, the greater the affect of making extra payments. Make sense? But if you're only making one extra payment a year (as you would with a typical bi-weekly repayment plan, you're only paying 8 1/3% more per year. This goes a long way toward increasing the rate at which you repay your principal and build equity, but it won't, unfortunately, cut your repayment term in half, unless you're talking about amazingly high interest rates on long-term loans, such as a 16% or 17% interest rate on a 30-year loan, which is not likely to be something any of us would ever consider.

  6. Mary Jackson 17, Apr, 2008

    This calculator is awesome. When I saw how easy it is to pay a little extra a month and how much sooner you can pay it off, I was elated. I owe 8 more years but after using your calculator and determining how much I could afford to pay extra per month, I should wipe it out in just two more. I am going to save quite a bit of money, not to mention getting rid of the debt 5 1/2 years early. Thanks for the calculator!

  7. bill 14, Apr, 2008

    Just checking - - - - EDITOR'S COMMENT: Anytime, Dude!

  8. Doug P 14, Feb, 2008

    Question. My original loan term is 30 mos. I wanted to find out how much I need to pay extra to turn it into a 10 year term. I"ve made 40 payments. Does the extra payment mean if I start paying the extra payment today it will be paid off in ten years or does it mean ten years from the start of the loan? EDITOR'S REPLY: Excellent question! On this calculator, "Loan Term" refers to the original loan term, and "New Loan Term" refers to the number of years between today and when you want to pay off the loan. "New Loan Term" is not measured from the start of the loan on this calculator.


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