Mortage Payoff Calculator

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Mortgage Payoff Calculator

Use this calculator to see how making additional payments or a one-time lump sum payment can significantly reduce your mortgage payoff time and save you thousands in interest.

function calculateMortgagePayoff() { var originalLoanAmount = parseFloat(document.getElementById('originalLoanAmount').value); var originalLoanTermYears = parseFloat(document.getElementById('originalLoanTermYears').value); var currentInterestRate = parseFloat(document.getElementById('currentInterestRate').value); var monthsPaid = parseFloat(document.getElementById('monthsPaid').value); var additionalMonthlyPayment = parseFloat(document.getElementById('additionalMonthlyPayment').value); var oneTimePayment = parseFloat(document.getElementById('oneTimePayment').value); // Input validation if (isNaN(originalLoanAmount) || originalLoanAmount <= 0 || isNaN(originalLoanTermYears) || originalLoanTermYears <= 0 || isNaN(currentInterestRate) || currentInterestRate <= 0 || isNaN(monthsPaid) || monthsPaid < 0 || isNaN(additionalMonthlyPayment) || additionalMonthlyPayment < 0 || isNaN(oneTimePayment) || oneTimePayment = originalLoanTermMonths) { document.getElementById('result').innerHTML = 'Months Already Paid cannot be greater than or equal to the Original Loan Term.'; return; } var monthlyInterestRate = currentInterestRate / 100 / 12; // 1. Calculate Original Monthly Payment var originalMonthlyPayment; if (monthlyInterestRate === 0) { originalMonthlyPayment = originalLoanAmount / originalLoanTermMonths; } else { originalMonthlyPayment = originalLoanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, originalLoanTermMonths)) / (Math.pow(1 + monthlyInterestRate, originalLoanTermMonths) – 1); } // 2. Calculate Remaining Balance before any additional payments var remainingBalanceBeforeOneTimePayment; if (monthlyInterestRate === 0) { remainingBalanceBeforeOneTimePayment = originalLoanAmount – (originalMonthlyPayment * monthsPaid); } else { remainingBalanceBeforeOneTimePayment = originalLoanAmount * Math.pow(1 + monthlyInterestRate, monthsPaid) – originalMonthlyPayment * (Math.pow(1 + monthlyInterestRate, monthsPaid) – 1) / monthlyInterestRate; } if (remainingBalanceBeforeOneTimePayment < 0) { remainingBalanceBeforeOneTimePayment = 0; } // 3. Apply One-Time Additional Payment var remainingBalanceAfterOneTimePayment = remainingBalanceBeforeOneTimePayment – oneTimePayment; if (remainingBalanceAfterOneTimePayment < 0) { remainingBalanceAfterOneTimePayment = 0; // Loan is paid off } // 4. Calculate New Monthly Payment var newMonthlyPayment = originalMonthlyPayment + additionalMonthlyPayment; // 5. Calculate New Payoff Time (in months) for the remaining balance var newRemainingMonths; if (remainingBalanceAfterOneTimePayment <= 0) { newRemainingMonths = 0; // Loan is already paid off } else if (newMonthlyPayment 0) { document.getElementById('result').innerHTML = 'Your new monthly payment is too low to pay off the remaining balance. Increase your additional payment.'; return; } else if (monthlyInterestRate === 0) { newRemainingMonths = remainingBalanceAfterOneTimePayment / newMonthlyPayment; } else { newRemainingMonths = -Math.log(1 – (remainingBalanceAfterOneTimePayment * monthlyInterestRate) / newMonthlyPayment) / Math.log(1 + monthlyInterestRate); } newRemainingMonths = Math.ceil(newRemainingMonths); // Round up to the next full month // 6. Calculate Original Remaining Months var originalRemainingMonths = originalLoanTermMonths – monthsPaid; // 7. Calculate Total Interest Paid (Original) var totalInterestOriginal = (originalMonthlyPayment * originalLoanTermMonths) – originalLoanAmount; if (totalInterestOriginal < 0) totalInterestOriginal = 0; // 8. Calculate Total Interest Paid (New) var interestPaidDuringMonthsPaid = (originalMonthlyPayment * monthsPaid) – (originalLoanAmount – remainingBalanceBeforeOneTimePayment); if (interestPaidDuringMonthsPaid < 0) interestPaidDuringMonthsPaid = 0; var interestPaidDuringNewPeriod; if (remainingBalanceAfterOneTimePayment <= 0) { interestPaidDuringNewPeriod = 0; } else { interestPaidDuringNewPeriod = (newMonthlyPayment * newRemainingMonths) – remainingBalanceAfterOneTimePayment; } if (interestPaidDuringNewPeriod < 0) interestPaidDuringNewPeriod = 0; var totalInterestNew = interestPaidDuringMonthsPaid + interestPaidDuringNewPeriod; if (totalInterestNew < 0) totalInterestNew = 0; // 9. Calculate Months Saved and Total Interest Saved var monthsSaved = originalRemainingMonths – newRemainingMonths; if (monthsSaved < 0) monthsSaved = 0; var totalInterestSaved = totalInterestOriginal – totalInterestNew; if (totalInterestSaved < 0) totalInterestSaved = 0; // Format results var formatter = new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD', minimumFractionDigits: 2, maximumFractionDigits: 2, }); var resultHTML = '

Calculation Results:

'; resultHTML += 'Original Monthly Payment: ' + formatter.format(originalMonthlyPayment) + "; resultHTML += 'Remaining Loan Balance (before additional payments): ' + formatter.format(remainingBalanceBeforeOneTimePayment) + "; resultHTML += 'Original Remaining Months: ' + originalRemainingMonths.toFixed(0) + ' months'; resultHTML += 'New Remaining Months (with additional payments): ' + newRemainingMonths.toFixed(0) + ' months'; resultHTML += 'Months Saved: ' + monthsSaved.toFixed(0) + ' months'; resultHTML += 'Total Interest Paid (Original): ' + formatter.format(totalInterestOriginal) + "; resultHTML += 'Total Interest Paid (New): ' + formatter.format(totalInterestNew) + "; resultHTML += 'Total Interest Saved: ' + formatter.format(totalInterestSaved) + "; document.getElementById('result').innerHTML = resultHTML; } .calculator-container { font-family: Arial, sans-serif; max-width: 600px; margin: 20px auto; padding: 20px; border: 1px solid #ccc; border-radius: 8px; background-color: #f9f9f9; } .calculator-inputs label { display: block; margin-bottom: 5px; font-weight: bold; } .calculator-inputs input[type="number"] { width: calc(100% – 22px); padding: 10px; margin-bottom: 15px; border: 1px solid #ddd; border-radius: 4px; } .calculator-inputs button { background-color: #007bff; color: white; padding: 12px 20px; border: none; border-radius: 4px; cursor: pointer; font-size: 16px; width: 100%; } .calculator-inputs button:hover { background-color: #0056b3; } .calculator-results { margin-top: 20px; padding: 15px; border: 1px solid #e0e0e0; border-radius: 4px; background-color: #e9f7ff; } .calculator-results h3 { color: #007bff; margin-top: 0; } .calculator-results p { margin-bottom: 8px; line-height: 1.5; } .calculator-results p strong { color: #333; }

Understanding Your Mortgage Payoff

A mortgage is often the largest debt most people will carry, and paying it off can be a significant financial milestone. A Mortgage Payoff Calculator helps you visualize the impact of making extra payments, whether it's a small amount each month or a large one-time lump sum, on your loan's duration and the total interest you pay.

How Does Extra Mortgage Payment Work?

When you make an extra payment on your mortgage, that additional money typically goes directly towards reducing your principal balance. Because your interest is calculated on the remaining principal, reducing this balance faster means you'll pay less interest over the life of the loan. This also shortens the time it takes to pay off your mortgage entirely.

Key Benefits of Early Mortgage Payoff:

  • Significant Interest Savings: By reducing the principal balance sooner, you cut down on the total interest accrued over the loan term, potentially saving tens of thousands of dollars.
  • Financial Freedom: Eliminating your largest monthly expense frees up a substantial portion of your income, allowing you to pursue other financial goals like retirement savings, investments, or education.
  • Increased Equity: Paying down your principal faster builds equity in your home more quickly, which can be beneficial if you need to borrow against your home or decide to sell.
  • Peace of Mind: Being debt-free, especially from a mortgage, provides a great sense of security and reduces financial stress.

How to Use the Calculator:

To get started, you'll need a few details about your existing mortgage:

  1. Original Loan Amount: This is the initial amount you borrowed for your mortgage.
  2. Original Loan Term (Years): The initial duration of your mortgage (e.g., 15, 20, or 30 years).
  3. Current Annual Interest Rate (%): The annual interest rate on your mortgage.
  4. Months Already Paid: The number of months that have passed since you started making payments on your mortgage.
  5. Additional Monthly Payment: The extra amount you plan to add to your regular monthly payment. Even a small amount can make a big difference over time.
  6. One-Time Additional Payment: A lump sum payment you might make, perhaps from a bonus, tax refund, or inheritance, to reduce your principal balance immediately.

After entering these details, the calculator will show you your original monthly payment, your current remaining balance, and then compare your original payoff schedule and total interest with the new schedule and interest based on your additional payments. You'll see exactly how many months you can shave off your mortgage and how much interest you'll save.

Example Scenario:

Let's say you have an original loan of $300,000 with a 30-year term at a 4.5% annual interest rate. You've already paid for 5 years (60 months). Your original monthly payment is approximately $1,520.06.

  • Original Loan Amount: $300,000
  • Original Loan Term (Years): 30
  • Current Annual Interest Rate (%): 4.5
  • Months Already Paid: 60

Without any extra payments, you have 300 months remaining, and your total interest paid over the life of the loan would be around $247,221.

Now, imagine you decide to make an additional monthly payment of $100 and also make a one-time payment of $5,000:

  • Additional Monthly Payment: $100
  • One-Time Additional Payment: $5,000

With these extra payments, the calculator would show you that you could pay off your mortgage significantly faster, potentially saving you tens of thousands of dollars in interest and years off your loan term. For instance, you might reduce your payoff time by 3-5 years and save over $20,000 in interest, depending on the exact amortization.

Experiment with different additional payment amounts to find a strategy that fits your budget and helps you achieve your goal of mortgage freedom sooner!

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