Every extra dollar you pay goes straight to principal, so it stops costing interest for the rest of the loan. Set your loan details, then change the extra monthly payment to see the new payoff date, how many years come off the term and how much interest you keep. It starts at $200 a month; try $100, $500 or your own number.
When to use this
Useful when deciding what to do with a raise or a paid-off car loan, comparing extra payments with investing the money, planning to be mortgage-free by a set date such as retirement, or checking what a biweekly payment plan is really worth.
Frequently Asked Questions
Is it better to pay extra each month or make one extra payment a year?
The total is what matters most, but paying monthly saves slightly more because each extra amount starts reducing interest sooner. Twelve extra monthly payments of $200 beat a single $2,400 payment at year end by a small margin.
Do biweekly mortgage payments really help?
Yes, because 26 half-payments a year equal 13 full payments, one more than usual. You get the same effect by adding a twelfth of a monthly payment to every payment, without paying a third party to set up a biweekly plan.
Should I pay off my mortgage early or invest?
Paying extra earns a guaranteed return equal to your mortgage rate. If your rate is low and you have an employer retirement match or high-interest debt, those usually come first. Keep an emergency fund before sending extra to the mortgage.
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