Mortgage Payoff Calculator

Extra payments go straight to principal, which immediately reduces the balance on which interest accrues each month. Because mortgage interest is calculated on the outstanding balance, a lower balance means less interest charged next month — and every month after that — creating a compounding snowball effect that can shave years off your loan.

Compare your mortgage interest rate to your expected after-tax investment return. If your mortgage rate is 6.5% and you expect a 7–8% return from a diversified index fund, investing may come out ahead on paper — but paying down the mortgage is a guaranteed, risk-free return equal to your interest rate. Your risk tolerance, tax situation, and emergency fund size all matter. Many people split the difference.

Yes. Paying half your monthly payment every two weeks results in 26 half-payments per year — the equivalent of 13 full monthly payments instead of 12. That one extra payment per year is applied entirely to principal and can cut several years off a 30-year mortgage without requiring a large lump-sum extra payment.