Loan Payoff Calculator
See how extra monthly payments accelerate your loan payoff and reduce total interest paid.
The Power of Extra Loan Payments
Extra principal payments work by reducing the base on which future interest is calculated. Every extra dollar paid today eliminates future interest charges on that dollar for the remaining loan term. Early extra payments are far more valuable than late ones because they have more time to compound interest savings.
Biweekly Payment Strategy
Switching from monthly to biweekly payments (half payment every 2 weeks) results in 26 half-payments = 13 full monthly payments per year instead of 12. That extra payment goes entirely to principal. On a 30-year mortgage, this strategy pays off the loan about 4 years early with no changes to your monthly budget.
When Not to Pay Extra
If your loan interest rate is low (under 4%) and you have tax-advantaged investment space (401k, IRA) not yet maximized, investing may provide better returns than extra loan payments. High-rate debt (credit cards, personal loans over 7–8%) should always be prioritized over extra mortgage payments.