Mortgage Payoff Calculator

How your target payment, biweekly plan, lump sum, and recast are worked out

Each month on a fixed-rate home loan, your lender charges one-twelfth of the note rate on what you still owe. In its answer on loan schedules, the Consumer Financial Protection Bureau (CFPB) writes: "The chart showing the amount of your payment that goes toward your principal and interest is called an amortization schedule." We run six schedules in whole cents from your balance, rate, and months left. On $250,000.00 at 6.5% with 300 months left, the current bill is $1,688.02. Month 1 is $1,354.17 of interest and $333.85 of principal (Regulation Z comment 17(c)(3)-1).

To hit your target month, we find the payment for the months left and the payment for your target months. The gap between them is the extra monthly principal you need. As the CFPB notes in its answer on paying off principal: "The quicker you’re able to pay down the principal of your loan – or the amount of money you’re borrowing – the less interest you’ll have to pay." Adding $489.75 a month on the default loan lifts month 1 principal to $823.60 and finishes in 180 months (179 full bills and a 180th bill of $2,177.32). You cut 120 months (10 years) and drop total interest from $256,404.68 to $141,998.15.

Target mortgage payoff and whole-cent amortization formula

r = annual rate ÷ 12          M_cur = round_cent(B × r × (1 + r)^n_rem ÷ ((1 + r)^n_rem − 1))
M_tgt = round_cent(B × r × (1 + r)^n_tgt ÷ ((1 + r)^n_tgt − 1))
extra_monthly = max(0, M_tgt − M_cur)          biweekly_extra = round_cent(M_cur ÷ 12)
interest_m = round_cent(B_(m−1) × r)           principal_m = (M_cur − interest_m) + extra_m
penalty_pct = round_cent(B × penalty_rate)     penalty_months = round_cent(B × r × months)
B current balance · r monthly rate · n_rem remaining months · n_tgt target months

Worked examples: 15-year target, CFPB sample loan H-24(B), and prepayment penalties

Full 30-year loan ($250,000.00 at 6.5% for 360 months to a 180-month target) and $350,000.00 recast benchmark. With all 360 months left on $250,000.00 at 6.5%, the scheduled bill is $1,580.17 and interest is $318,861.58. A 180-month payoff takes $597.60 extra a month and saves $176,863.43 and 15 years. On $350,000.00 at 6.0% with 324 months left cut to 240 months, the bill rises from $2,183.95 to $2,507.51 ($323.56 extra a month) and saves $105,797.01. Sending a $50,000.00 lump sum with a recast over 324 months drops the bill by $311.99 to $1,871.96 and saves $51,087.27.

CFPB sample Loan Estimate form H-24(B) ($162,000.00 at 3.875% for 360 months to a 180-month target). Page 1 of the CFPB's sample form H-24(B) states: "This loan is for the purchase of property at a sale price of $180,000 and has a loan amount of $162,000, a 30-year loan term, a fixed interest rate of 3.875 percent, and a prepayment penalty equal to 2.00 percent of the outstanding principal balance of the loan for the first two years after consummation of the transaction." The 360-month bill is $761.78 (360th bill $764.68 and interest $112,243.70). In the first 60 months, $15,772.58 of principal is paid, which rounds to $15,773 on page 3 under 12 CFR 1026.37(o)(4). Finishing in 180 months takes $1,188.17 a month ($426.39 extra). Because $1,188.17 rounds down from $1,188.1720, month 180's bill is $1,188.71 (+$0.54). Interest drops to $51,871.14, saving $60,372.56, with $43,952.49 of principal paid in 60 months. On $320,000.00 at 6.25% cut from 360 to 180 months ($1,970.30 to $2,743.75, or $773.45 extra), interest drops from $389,303.05 to $173,876.01, saving $215,427.04.

Prepayment penalty check (QM caps, 6 months' interest, and a short-term trap). On the default $250,000.00 loan, the years 1–2 QM cap leaves $109,406.53 net on the target plan or $36,782.45 net on the $10,000.00 lump sum. The year-3 cap leaves $111,906.53 net on the target plan or $36,882.45 net on the lump sum. A 6-month interest fee is $8,125.00 on the balance ($106,281.53 net) or $325.00 on the lump sum ($36,657.45 net). Now take a $100,000.00 non-QM loan at 4.0% with 24 months left cut to 12 months ($4,342.49 to $8,514.99, or $4,172.50 extra). Gross interest saved is $2,039.96 ($4,219.84 vs $2,179.88), so a 5% fee ($5,000.00) loses $2,960.04 (net -$2,960.04).

Scope, Regulation Z servicing rules, and modeling limits

• Your contract note rate stays fixed across the remaining payoff horizon. Each month's interest rate equals one-twelfth of the annual note rate (rateMilli ÷ 1,200,000).
• Scheduled monthly bills and monthly interest charges round half up to whole cents, which is this calculator's convention. Regulation Z comment 17(c)(3)-1 says payments cannot be collected in fractional cents and the last payment may be adjusted. The final monthly payment here adjusts to zero out the exact remaining balance.
• This page assumes every extra monthly payment goes 100% to principal on the due date with no fee. Your loan contract and servicer decide that. For a current loan owned by Fannie Mae, Servicing Guide C-1.2-01 has the servicer accept and apply a principal curtailment you identify as such.
• The one-time lump sum cuts principal at month 0 before month 1 interest runs. To test a later month or an annual bonus, open the Loan Extra Payment Calculator.
• Biweekly half-payments add round_cent(currentPayment ÷ 12) each month (26 half-payments = 13 full monthly bills a year).
• Principal and interest only. Property tax, home insurance, HOA dues, and PMI in escrow are left out. In its answer on mortgage rates vs APR, the CFPB notes: "An annual percentage rate (APR) reflects the mortgage interest rate plus other charges." Enter your note rate here, not the APR.
• Penalty options show a worst case. Under 12 CFR 1026.43(g)(2), a qualified mortgage penalty is capped at a percentage of the loan balance prepaid. In its answer on prepayment penalties, the CFPB notes that penalties do not normally apply when you pay extra principal in small chunks. Here the penalty is charged on the full starting balance for the target and biweekly plans. For the lump-sum and recast plans it is charged on the lump sum. Net savings are therefore a lower bound. Balances run from $100 to $100,000,000, rates from 0% to 100%, and terms from 1 to 600 months.

These figures are estimates for learning and planning, not financial, tax, legal or investment advice. Terms of use.

What to check before sending extra mortgage principal

Check page 1 of your Loan Estimate under Loan Terms to see if a prepayment penalty applies (12 CFR 1026.37(b)(4)). Under 12 CFR 1026.43(g), non-qualified and higher-priced home loans cannot charge one, keeping the full $114,406.53 savings on the default loan. Check closing fees in the closing costs calculator.

Mark every extra payment as principal-only in your servicer's portal. The full $489.75 a month (or $10,000.00 lump sum) then goes to principal instead of being held toward next month's bill. Test a later lump sum in the loan extra payment calculator.

Pick between a shorter term and a lower monthly bill when sending a lump sum. Keeping your regular bill after a $10,000.00 lump sum saves 27 months and $36,982.45, while a recast over 300 months saves $10,256.65. Weigh a curtailment against a recast in the mortgage recast calculator.

Ask your servicer when your balance reaches 80% of the original home value, then ask for PMI removal in writing under 12 U.S.C. 4902(a). Extra principal brings that date forward, but this page cannot show it without your original value. Also compare a 15-year loan: in its guide to loan choices, the CFPB notes that on a shorter term "The interest rate is usually lower—by as much as a full percentage point." Check rate gaps in the 15 vs 30 year mortgage calculator.

Questions about paying off a mortgage early