Understand Your Extra Payment
Extra Payment Calculator
Quickly estimate your mortgage payments by adding an extra payment and get a clearer picture of your financial future with our easy-to-use calculator.
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Common Questions About Extra Payment Calculations
Understanding mortgage calculations can be complex. Here are some frequently asked questions to help you navigate the process.
How do extra payments affect my loan payoff date?
Making extra payments toward your loan principal reduces the overall balance faster, which can shorten your loan term and save you money on interest. Use an extra payment calculator to estimate how much sooner you’ll pay off the loan.
Can I reduce interest by making extra payments on my mortgage?
Yes, extra payments directly reduce the principal amount, which decreases the interest accrued over time. The more frequent or larger the extra payments, the more interest savings you’ll accumulate throughout the loan term.
How do I calculate how much I’ll save by making an extra mortgage payment?
To calculate potential savings, use an online calculator by inputting your loan amount, interest rate, and the amount of your extra payments. It will show you how much interest you’ll save and how much sooner your loan will be paid off.
Should I make extra payments toward the principal or interest?
It’s most beneficial to apply extra payments toward the principal. Reducing the principal lowers the amount on which future interest is calculated, allowing you to save money in the long term.
How often should I make extra payments to see significant savings?
Making extra payments as often as you can, whether monthly, quarterly, or annually, will help reduce your loan balance and the interest paid. Even small, consistent extra payments can result in substantial savings over the life of the loan.