Mortgage Extra Payment

Mortgage Extra Payment Calculator

Find out exactly how much interest you'll save — and how many years earlier you'll be mortgage-free — by paying extra on your home loan. Built for U.S. mortgages, with support for the UK, Canada and Australia.

✔ Standard U.S. amortization math ✔ Monthly, lump sum, annual & bi-weekly extras ✔ Full monthly & yearly schedule ✔ 100% free, no signup
Loan details
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Extra payment strategy
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Month 1 = first payment
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Your results will appear here

Fill in your loan details and choose an extra payment strategy to see how much interest and time you could save.

How extra mortgage payments save you money

Every mortgage payment is split between interest (the cost of borrowing) and principal (what you actually owe). Interest is recalculated each period based on your outstanding balance — so any extra amount you put toward principal reduces the balance interest is charged on for every single period that follows, not just once.

Less interest, guaranteed

Because interest accrues on the remaining balance, a lower balance today means lower interest charges for every remaining month of the loan — a compounding effect in your favor.

Years off your term

Extra payments don't just reduce interest — they shorten the loan itself. Consistent overpayments of even a modest amount routinely cut 5-10 years off a 30-year mortgage.

Timing matters

A dollar of extra principal paid in year 1 saves more interest than the same dollar paid in year 20, because it removes that balance from the interest calculation for longer.

Mortgage prepayment rules by country

Extra payment rules and interest calculation conventions differ significantly between countries. This calculator applies the correct convention for whichever country you select, and the notes below summarize what to check with your own lender.

United States

US mortgages compound interest monthly (annual rate ÷ 12). Under federal law, most fixed-rate mortgages originated after 2014 cannot carry prepayment penalties, and the vast majority of conventional, FHA and VA loans allow unlimited extra principal payments at any time free of charge. Always confirm by checking your note or asking your servicer, and specify in writing that extra payments should be applied to principal, not held as a future payment credit.

United Kingdom

UK mortgages ("overpayments") typically allow you to overpay up to 10% of the outstanding balance per year penalty-free during a fixed-rate deal — overpaying beyond that can trigger an Early Repayment Charge (ERC), often 1-5% of the excess amount. Once you're on your lender's standard variable rate (SVR), overpayment limits usually disappear entirely. Interest is generally calculated daily on the balance, with monthly compounding used for standard payment calculations.

Canada

By law (the Interest Act), Canadian fixed-rate mortgages compound interest semi-annually, not monthly — this calculator applies that exact convention when you select Canada, giving a slightly lower effective monthly rate than a simple annual-rate ÷ 12 calculation. Most Canadian mortgage contracts include specific "prepayment privileges," commonly 10-20% of the original principal per year, plus a separate lump-sum allowance. Exceeding your privilege triggers a prepayment penalty, often calculated as the greater of three months' interest or an interest rate differential (IRD).

Australia

Most Australian variable-rate home loans allow unlimited extra repayments with no penalty, and many are bundled with a redraw facility or offset account that lets you access the extra funds later while still reducing the interest charged. Fixed-rate loans in Australia typically cap penalty-free extra repayments (often around AUD 10,000-30,000 per year, varying by lender) — exceeding the cap can trigger a break cost. Interest is calculated daily on the outstanding balance, with monthly compounding used for standard repayment calculations.

Related calculators & guides

How Extra Mortgage Payments WorkThe math behind interest savings, explained simply Pay Off Early vs. InvestA math-first framework for the decision Does Paying Extra Lower My Payment?Why the term shrinks but the payment doesn't Recast vs. Extra PaymentsLower payment or shorter loan? Apply Extra Payments to PrincipalHow to instruct your servicer correctly Bi-Weekly Mortgage CalculatorSee the accelerated bi-weekly effect in detail Lump Sum Payment CalculatorModel a one-time extra payment against your mortgage All guides →Taxes, mistakes, strategies and country rules

Frequently asked questions

How much can I save by paying extra on my mortgage?
It depends on your loan balance, interest rate, remaining term, and how much extra you pay. On a typical $300,000 30-year loan at 6.5% interest, paying an extra $200 per month can save over $85,000 in interest and pay off the loan more than 6 years early. Use the calculator above with your own numbers for an exact figure.
Is it better to pay extra monthly or make a one-time lump sum payment?
Both reduce your principal balance and save interest, but the sooner extra money is applied, the more interest it saves, because interest is calculated on the outstanding balance. A large lump sum early in the loan often saves more interest than the same total amount spread out later, while consistent monthly extra payments compound their effect throughout the loan term. Try both scenarios in the calculator above to compare.
Do Canadian mortgages calculate interest differently than US mortgages?
Yes. Under Canada's Interest Act, fixed-rate mortgages must be compounded semi-annually, not monthly, even though payments are made monthly. This results in a slightly lower effective monthly interest rate than the simple annual-rate-divided-by-12 method used in the US, UK and Australia. This calculator applies the correct convention automatically when you select Canada. Read more in our Canadian mortgage guide.
Will my lender let me make extra mortgage payments?
Most fixed-rate mortgages in the US allow unlimited extra principal payments with no penalty. In the UK, most lenders cap penalty-free overpayments at 10% of the outstanding balance per year during a fixed-rate deal. In Canada, prepayment privileges are typically 10-20% of the original principal per year, defined in your mortgage contract. Always confirm your specific prepayment privileges with your lender before making extra payments.
What is an accelerated bi-weekly mortgage payment?
An accelerated bi-weekly payment schedule takes your normal monthly payment, divides it in half, and pays that half every two weeks. Because there are 26 two-week periods in a year, you end up making the equivalent of 13 monthly payments per year instead of 12 — one extra full payment annually — which shortens your loan term and reduces total interest. Try it with the "Accelerated bi-weekly" option in the calculator above, or visit our dedicated bi-weekly calculator.

Ready to see your own numbers?

Enter your loan details above and try a few different extra payment strategies — the results update instantly.

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