Mortgage Payoff Calculator

How mortgage amortization works

A fixed-rate mortgage is paid in equal monthly installments, but the split between principal and interest changes every month. Early on, most of your payment covers interest because the loan balance is largest. As the balance falls, more of each payment goes toward principal and less toward interest.

That front-loaded interest is why extra principal payments are so powerful early in the loan. A dollar paid in year two avoids 28 more years of interest on that dollar. The same dollar paid in year 25 avoids only a few months of interest.

Principal and interest vs your full payment

Most homeowners write one check that includes principal, interest, property taxes, homeowners insurance, and sometimes HOA or PMI. Only principal and interest reduce the loan balance and affect your payoff date. This calculator asks for P&I only, so the schedule reflects the actual loan — not your escrowed bills.

If you do not know your P&I, look at your mortgage statement. It usually lists a "principal and interest" line separate from escrow. Or enter your original loan amount, rate, and term into a standard amortization formula to get the figure.

A worked example

The default above is a $300,000 mortgage at 6.5% APR with a $1,896 monthly P&I payment. Over 30 years that loan costs roughly $382,000 in total payments, including about $82,000 in interest.

Add $100 a month toward principal and the loan ends about 4.5 years sooner, saving over $25,000 in interest. Add $250 a month and you cut roughly 10 years and more than $60,000 in interest. The chart and schedule above show the exact month-by-month impact.

Refinance or pay extra?

Refinancing makes sense when market rates have dropped enough that the new rate plus closing costs beats your current loan over the time you plan to stay. But a refinance that restarts the clock to 30 years can cost more total interest even at a lower rate.

Paying extra has no closing costs, no credit check, and no risk. It also builds equity faster, which helps if you sell or need a home equity line later. If you are deciding between the two, compare total interest paid through your planned payoff date, not just the new monthly payment.

Biweekly payments and one extra payment a year

Paying half your monthly amount every two weeks gives you 26 half-payments, or 13 full payments per year instead of 12. That single extra payment can cut several years off a 30-year mortgage. You can get the same effect by adding one-twelfth of your P&I to each monthly payment.

Before you request a payoff quote

When you are close to the end, call your servicer and ask for a ten-day payoff quote. It will include interest accrued to the payoff date plus any fees. Use that figure, not this estimate, for your final wire or check. This calculator is for planning, not a lender payoff instruction.