How This Extra Payment Calculator Works
This extra payment calculator estimates how additional monthly payments may affect your loan. Enter your loan amount, interest rate, loan term, and extra monthly payment to compare your regular payment with your payment after adding extra money toward the loan.
Making extra payments can reduce the amount of interest you pay over time because more money goes toward lowering your principal balance.
Why Make Extra Payments?
Extra payments can help reduce total interest, shorten your repayment timeline, and give you more control over your debt. Even a small additional payment each month may make a meaningful difference over the life of a loan.
What This Calculator Shows
This calculator estimates your base monthly payment, monthly payment with extra payments, total interest without extra payments, estimated interest savings, and estimated total interest with extra payments.
Extra Payments and Interest Savings
When extra payments are applied toward principal, your loan balance can decrease faster. A lower balance usually means less interest accrues over time.
Example Scenario
For example, adding $200 per month to a $300,000 loan at 6.5% could reduce your payoff time by several years and save over $100,000 in interest.
FAQ
Do extra payments reduce interest?
Yes. Extra payments can reduce your loan balance faster, which may lower the total interest paid over the life of the loan.
Should extra payments go toward principal?
In most cases, yes. Extra payments are most helpful when they are applied directly to principal.
Can I use this calculator for a mortgage?
Yes. This calculator can be used for mortgages, auto loans, personal loans, and other fixed-rate loans.
Is the interest savings exact?
No. This calculator provides an estimate. Actual savings may vary based on lender rules, payment timing, fees, and how extra payments are applied.
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