Mortgage Prepayment Calculator

Introduction: The Mortgage Prepayment Calculator is a helpful tool for homeowners looking to understand the potential impact of making extra payments on their mortgage. By entering loan details and an additional monthly payment, users can estimate the time it takes to pay off the loan and the total interest saved.

Formula: The calculator utilizes the following formula to calculate the remaining loan balance over time with extra payments: Remaining Balance=(Remaining Balance×(1+Monthly Interest Rate))−Extra PaymentRemaining Balance=(Remaining Balance×(1+Monthly Interest Rate))−Extra Payment It iteratively calculates the remaining balance until it reaches zero.

How to Use:

  1. Enter your Loan Amount.
  2. Input the Annual Interest Rate.
  3. Specify the Loan Term in years.
  4. Provide the Extra Payment per Month.
  5. Click the “Calculate” button to view the results.

Example: Suppose you have a $200,000 loan with a 4% annual interest rate and a loan term of 30 years. If you make an extra payment of $100 per month, use the Mortgage Prepayment Calculator to estimate the time it takes to pay off the loan and the total interest saved.


  1. How does the Mortgage Prepayment Calculator work? The calculator estimates the remaining loan balance over time with additional monthly payments, helping users understand the impact on the loan payoff period and interest savings.
  2. Can I use the calculator for different loan terms? Yes, the calculator is flexible and can be used for various loan terms by adjusting the input.
  3. What is the significance of the Extra Payment field? The Extra Payment field allows you to input an additional amount you plan to pay monthly towards your mortgage, accelerating the payoff process.
  4. Is the Monthly Interest Rate the annual rate divided by 12? Yes, the Monthly Interest Rate is calculated by dividing the annual interest rate by 100 and then dividing by 12 to get the monthly rate.
  5. How accurate are the results provided by the calculator? The results are estimates based on the provided information. Actual results may vary based on changes in interest rates, fees, or other factors.
  6. Can I use the calculator for loans with variable interest rates? The calculator assumes a fixed interest rate. Results for variable rate loans may differ.
  7. What happens if I make irregular extra payments? The calculator provides an estimate based on regular monthly extra payments. Irregular payments may result in different outcomes.
  8. Is there a penalty for making extra payments on a mortgage? It’s essential to check your loan agreement. Many loans allow extra payments, but some may have prepayment penalties.
  9. Can the calculator handle different currencies? Yes, as long as the currency is consistent for all input fields, the results will be in that currency.
  10. Is the calculator suitable for refinanced loans? Yes, the calculator can be used for refinanced loans, assuming the loan details remain consistent.

Conclusion: The Mortgage Prepayment Calculator empowers homeowners to make informed decisions about their mortgage payments. By understanding the potential impact of extra payments, individuals can save on interest costs and achieve mortgage freedom sooner. However, it’s essential to consult with your lender and carefully review your loan terms before making additional payments.

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