How extra payments shorten a mortgage
Each regular payment covers that month's interest first. Any extra money goes straight to principal, so the next month's interest is smaller and more of your regular payment goes to principal too. This snowball effect is why modest extras can cut years off a loan.
Example
With $250,000 left at 6.5% and 25 years to go, the principal-and-interest payment is about $1,688 and the remaining interest is about $256,000. Paying $200 extra a month finishes the loan in about 19½ years and saves around $65,000.
Before you pay extra
- Check for prepayment penalties in your loan documents (rare on most US mortgages today).
- Tell your servicer to apply extra money to principal, not to future payments.
- Keep an emergency fund. Money paid into your home is hard to get back out quickly.
- Compare with other goals like retirement savings or paying off higher-rate debt.
Thinking of a lower rate instead? Try the refinance calculator. To see a new mortgage, use the mortgage calculator.
Last reviewed October 2026.
Frequently asked questions
How much faster will extra payments pay off my mortgage?
It depends on your balance, rate and how much extra you pay. In the default example, $200 extra a month on a $250,000 balance at 6.5% with 25 years left cuts about 5½ years off the loan and saves roughly $65,000 in interest.
Is it better to pay extra monthly or make a lump sum?
Both reduce principal. Money paid earlier saves more interest, so a lump sum today beats the same amount spread over a year. Regular monthly extras are easier for most budgets. The calculator handles both.
Should I pay off my mortgage early or invest?
Paying extra gives a guaranteed return equal to your mortgage rate. Investing may earn more over time but carries risk. Many people first build an emergency fund, capture any 401(k) employer match and pay off high-interest debt before paying extra on a mortgage.
Does paying extra lower my monthly payment?
Usually not. Your required payment stays the same and the loan ends sooner. Some lenders offer a "recast", which re-amortizes the loan after a large lump sum to lower the payment, often for a small fee.
Do biweekly payments help?
Paying half your payment every two weeks adds up to 26 half-payments, or 13 full payments a year. That one extra payment a year can shorten a 30-year mortgage by several years. Make sure your lender applies the money right away and does not charge a fee.