Extra Mortgage Payment Calculator

On a $300,000 30-year mortgage at 6.5%, paying an extra $200/month saves about $73,000 in interest and pays the loan off 5.5 years early. Even one extra annual payment (1/12 added monthly) typically saves 4+ years and over $50,000. The earlier in the loan you start, the more you save - interest is front-loaded.

Compare your mortgage rate to your expected after-tax investment return. Mortgage paydown is a guaranteed return equal to your rate; investing has higher expected but uncertain returns. With a 3% mortgage and 7% expected investment return, investing wins on math. With a 7% mortgage and stocks priced for lower returns, paydown looks better. The Debt Payoff vs. Invest tool models this directly.

Most lenders apply extra payments to principal automatically only if you specifically write "apply to principal" on the check, in the online payment memo, or via a separate principal-only payment option. Without that designation, the extra may be applied to next month's interest or held in suspense. Always confirm by checking the next statement.

Yes - you lose liquidity (money in the house is hard to access without a HELOC or sale), and you may lose some mortgage interest deduction value if you itemize. Don't pay extra on the mortgage if you're behind on retirement contributions, lack an emergency fund, or carry higher-interest debt elsewhere.