Extra mortgage payment calculator
Adding to the principal each month shortens the term, and because interest accrues on the balance, the saving compounds.
%
Interest saved
101 283.34
- Years cut from the term
- 7.33
- New number of payments
- 272.0
- Original payment
- 1769.79
- Payment with the extra
- 1969.79
- Interest without overpaying
- 357 124.57
- Interest with the overpayment
- 255 841.23
Show the working
- Balance outstanding = 280 000
- Annual interest rate = 6.5
- Years remaining = 30
- Extra per month = 200
- i = 6.5 / 100 / 12 = 0.005 416 67
- n = 30 * 12 = 360
- growth = (1 + 0.005 416 67)^360 = 6.9918
- Original payment = 280 000 * 0.005 416 67 * 6.9918 / (6.9918 - 1) = 1769.79
- Payment with the extra = 1769.79 + 200 = 1969.79
- New number of payments = log(1969.79 / (1969.79 - 280 000 * 0.005 416 67), 1 + 0.005 416 67) = 272.03
- months_saved = 360 - 272.03 = 87.9704
- Years cut from the term = 87.9704 / 12 = 7.330 87
- Interest without overpaying = 1769.79 * 360 - 280 000 = 357 125
- Interest with the overpayment = 1969.79 * 272.03 - 280 000 = 255 841
- Interest saved = 357 125 - 255 841 = 101 283
Values are shown to six significant figures here; the arithmetic itself runs on exact fractions and is only rounded where a number is printed.
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The formula
- new term n = log(payment / (payment - P i)) / log(1 + i)
- The extra payment only works if the new payment exceeds the monthly interest P x i.
Some lenders charge for early repayment, and some apply overpayments only at the year end. Check before relying on this.
This is arithmetic, not financial advice. Real products carry fees, tax treatment and terms that no formula captures.