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Mortgage Payoff & Amortization Calculator

See how making extra principal payments can shorten your loan term and save you thousands in interest.

Do not include taxes or insurance.
Amount added to principal every month.
function calculateMortgagePayoff() { var balanceInput = document.getElementById('currentBalance').value; var rateInput = document.getElementById('interestRate').value; var paymentInput = document.getElementById('monthlyPayment').value; var extraInput = document.getElementById('extraPayment').value; var balance = parseFloat(balanceInput); var annualRate = parseFloat(rateInput); var monthlyPayment = parseFloat(paymentInput); var extraPayment = parseFloat(extraInput); if (isNaN(extraPayment)) { extraPayment = 0; } if (isNaN(balance) || isNaN(annualRate) || isNaN(monthlyPayment) || balance <= 0 || annualRate < 0 || monthlyPayment <= 0) { document.getElementById('payoffResult').innerHTML = "
Please enter valid positive numbers for Current Balance, Interest Rate, and Required Monthly Payment.
"; return; } var monthlyRate = annualRate / 100 / 12; var firstMonthInterest = balance * monthlyRate; if (monthlyPayment <= firstMonthInterest) { document.getElementById('payoffResult').innerHTML = "
Warning: Your current required monthly payment is not enough to cover the accruing interest ($" + firstMonthInterest.toFixed(2) + "/month). At this rate, the loan balance will increase rather than decrease. Please check your input values.
"; return; } var simulatePayoff = function(simBalance, simRate, simBasePayment, simExtraPayment) { var months = 0; var totalInterestPaid = 0; var totalPayment = simBasePayment + simExtraPayment; var maxMonths = 720; while (simBalance > 0.01 && months < maxMonths) { var interestForMonth = simBalance * simRate; var principalForMonth = totalPayment – interestForMonth; if (simBalance < principalForMonth) { principalForMonth = simBalance; interestForMonth = simBalance * simRate; } simBalance -= principalForMonth; totalInterestPaid += interestForMonth; months++; } return { months: months, totalInterest: totalInterestPaid }; }; var currentScenario = simulatePayoff(balance, monthlyRate, monthlyPayment, 0); var acceleratedScenario = simulatePayoff(balance, monthlyRate, monthlyPayment, extraPayment); var monthsSaved = currentScenario.months – acceleratedScenario.months; var interestSaved = currentScenario.totalInterest – acceleratedScenario.totalInterest; var currentYears = Math.floor(currentScenario.months / 12); var currentRemainingMonths = currentScenario.months % 12; var acceleratedYears = Math.floor(acceleratedScenario.months / 12); var acceleratedRemainingMonths = acceleratedScenario.months % 12; var savedYears = Math.floor(monthsSaved / 12); var savedRemainingMonths = monthsSaved % 12; var formatter = new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }); var resultHTML = "
"; resultHTML += "
"; resultHTML += "

Current Payoff Path

"; resultHTML += "Time Remaining: " + currentYears + " Years, " + currentRemainingMonths + " Months"; resultHTML += "Total Future Interest: " + formatter.format(currentScenario.totalInterest) + ""; resultHTML += "
"; resultHTML += "
"; resultHTML += "

Accelerated Path (+Extra)

"; resultHTML += "Time Remaining: " + acceleratedYears + " Years, " + acceleratedRemainingMonths + " Months"; resultHTML += "Total Future Interest: " + formatter.format(acceleratedScenario.totalInterest) + ""; resultHTML += "
"; resultHTML += "
"; if (extraPayment > 0 && monthsSaved > 0) { resultHTML += "
"; resultHTML += "

Your Potential Savings

"; resultHTML += "You could save a total of " + formatter.format(interestSaved) + " in interest!"; resultHTML += "You will become debt-free " + savedYears + " Years and " + savedRemainingMonths + " Months sooner."; resultHTML += "
"; } else if (extraPayment <= 0) { resultHTML += "Enter a positive extra monthly payment amount above to see your potential savings."; } else { resultHTML += "The extra payment is too small to impact the loan term significantly due to rounding near the end of the loan."; } document.getElementById('payoffResult').innerHTML = resultHTML; }

Understanding Mortgage Amortization and Accelerated Payoff

For most homeowners, a mortgage is the largest debt they will ever take on. The standard repayment structure, known as amortization, ensures that your payments are spread evenly over the life of the loan (typically 15 or 30 years). However, the way your payment is applied changes dramatically over time.

How Mortgage Payments Are Applied

In the early years of your mortgage, the vast majority of your monthly payment goes toward paying off interest, with only a small fraction reducing the actual loan balance (the principal). As time goes on and the principal balance decreases, the interest charge each month becomes smaller, allowing more of your payment to go toward the principal.

This "front-loaded" interest structure is why paying extra early in the loan term is so effective. By making additional payments toward the principal, you directly reduce the balance upon which future interest is calculated.

The Power of Extra Principal Payments

Even modest extra payments can yield substantial long-term savings. When you pay more than your required monthly amount, and specify that the excess should be applied to the principal only, you achieve two things:

  1. You save money: You reduce the total amount of interest paid over the life of the loan.
  2. You save time: You shorten the loan term, paying off your house years sooner than scheduled.

Realistic Example of Accelerated Payoff

Let's look at a realistic scenario to illustrate the power of extra payments using the math behind our calculator:

  • Current Loan Balance: $250,000
  • Interest Rate: 5.0%
  • Remaining Term: 30 Years (implied by the standard payment below)
  • Required Monthly Principal & Interest Payment: $1,342.05

If you continue on this standard path, over the next 30 years, you will pay approximately $233,139 in total interest—nearly as much as the original loan amount!

The Accelerated Scenario: Now, imagine you budget an extra $200 per month toward the principal, bringing your total payment to $1,542.05.

  • New Payoff Time: Approx. 22 Years and 8 months.
  • Time Saved: You cut nearly 7 years and 4 months off your mortgage.
  • Interest Saved: You save approximately $65,500 in interest charges.

That $200 monthly sacrifice translates into tens of thousands of dollars saved and financial freedom achieved over seven years earlier.

Important Considerations Before Accelerating Your Mortgage

While paying off your mortgage early is an excellent financial goal, it isn't always the first priority for everyone. Before committing extra cash to your home loan, ensure you have checked these boxes:

  • Emergency Fund: Do you have 3-6 months of living expenses saved in a liquid account?
  • Higher-Interest Debt: Do you have credit card debt or personal loans with interest rates higher than your mortgage rate? It is mathematically superior to pay off higher-rate debt first.
  • Retirement Savings: Are you contributing enough to retirement accounts, especially if your employer offers a matching contribution?

If your financial foundation is solid, using this Mortgage Payoff Calculator to plan an accelerated repayment strategy is a powerful step toward long-term wealth building.

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