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Early Mortgage Payoff Calculator

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Early Mortgage Payoff Calculator excel to calculate early mortgage payoff and total interest savings by paying off your mortgage early.

Early Loan Payoff Calculator

Mortgage Balance
Interest Rate
Current Monthly Payment
Extra Monthly Payment
Desired Payoff Years
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Early Loan Payoff Calculator

The mortgage early payoff calculator will show you an amortization schedule with the new additional mortgage payment. You will get a comparison table that compares your original mortgage with the early payoff. If you want to make an extra payment each month to pay off your mortgage, use the mortgage payoff calculator extra payment. This early loan payoff calculator is useful to calculate how many years in the future that you want to pay off the loan. You can also pay off your mortgage early by increasing your monthly payment, you can use the Mortgage Payoff Calculator. Use the mortgage calculator with PMI and extra payments to calculate your monthly or biweekly mortgage payments. Read How to Pay Off Mortgage Earlier to learn some tips on how to pay off your mortgage quicker.

How to pay off mortgage in 5 years calculator

If you want to pay off your mortgage in 5 years, you can use this early mortgage payoff calculator. All you have to do is to set the Desired Payoff Years field to 5 and leave the Extra Monthly Payment field empty.

How to pay off your mortgage early?

There are a few ways that you can pay off your mortgage early, by making extra payments, refinance, or recasting your mortgage.

  • Increase your monthly payment - By paying a few hundred dollars extra per month, you can greatly reduce the mortgage term and save a lot of money on interest.

    For most families, a few hundred dollars extra is a lot of money, which would mean they may have to cut expenses in other areas of their life. Even as little as a 10% increase in monthly payment helps.

  • Increase the frequency of payments - Instead of the monthly payment, you can use a biweekly payment plan. By making biweekly payments, you will end up with 13 yearly payments instead of 12.

    One extra payment per year might not seem like a lot, but it can pay off your mortgage years earlier. You can use ourbiweekly mortgage calculatorto estimate how much you can save in interest payment, and how much faster you can pay off your mortgage with biweekly payments.

  • Make a lump sum payment - If you get a bonus at year-end, receive an inheritance, or your stock investment has grown and you decided to cash in.

    You can then use this extra cash to make a lump sum payment towards your principal. It doesn't have to be recurring, and a one-time lump sum payment helps with your mortgage payment and reduces the burden of your interest payment.

  • Refinance your mortgage - Refinance is another option if the mortgage rate has declined since you bought your house. If your original term was 30 years, you can consider refinancing it to a 15-year term.

    This will greatly lower your overall interest payment, and cut your term by many years. However, the downside is that you will have to pay more each month in mortgage payments because you've shortened the term.

    For this option to work, the mortgage rate has to be much lower compared to your existing rate, and you need to have savings that you can afford for the extra money that you will be paying each month. Also, keep in mind, you will have to pay a refinance fee to cover all the costs involved.

  • Recast your mortgage - If refinance is not an option, you may consider recasting the mortgage. Recasting is essentially the same as making a lump sum payment. Some lenders do not allow lump-sum payment, that's why recasting may be an option.

    Recasting allows the borrower to keep the same interest rate and term with a lower balance. There is a recasting fee that you need to pay the bank for recasting your mortgage.

    The downside of recasting is that it does not reduce your term, so you won't pay off your mortgage earlier, but you are saving money on interest.

  • Make a bigger down payment - so you don't have to pay for PMI. Most banks and lenders require the borrower to pay monthly private mortgage insurance or PMI if their down payment is less than 20%.

    As soon as the borrower has 20% of equity on their house, they can stop making payments for PMI. Therefore, if you make a bigger down payment, you will avoid paying extra for the PMI.

  • Downsize - instead of living in a big house, you may consider selling it and using the money to buy a smaller and less expensive house.

    With the profit that you sold your home, you might be able to buy a smaller house with cash or a much smaller mortgage. You can even move to a different city, state, or neighborhood where housing is more affordable.

Is there any penalty for paying off the mortgage early?

Each bank and lender is different. You will need to check with your lender first before you start making extra payments to pay off your mortgage each month. You want to make sure that there is no penalty for making extra payment and the extra payment is towards principal, not for interest. Also, some lenders do not allow refinance or recast, so make sure you check with them first before you do anything else.

How to save more money for extra mortgage payments?

To pay off your mortgage early, you will need to increase your monthly payments toward the principal of your mortgage. Depending on the size of your mortgage, making a few hundred extra dollars each month could save you a lot of money in interest and pay off your loan many years faster. If you don't have the extra money, here are a few habits that can cut your monthly expenses and save more money that you can use for your extra mortgage payment.

  • Sell used stuff from your garage - If you don't need or use an item anymore, instead of throwing it out or letting it sit in your garage, try to sell it. Old clothes that you no longer wear, old toys that your kids no longer play with.

    You can list them on online market platforms like eBay, Craigslist, Facebook Marketplace, or OfferUp. You can then use this cash to make extra payments on your mortgage.

  • Cut your spending - Another excellent way to save more money is to cut your spending. Track your monthly spending with a mobile app and record everything you buy for that month.

    Review your spending habits at the end of the month and see which expenses you can cut next month. Keep recording and tracking your spending habits for a few more months, and you will learn how to cut spending on unnecessary things.

  • Increase your income - Talk to your boss and see if you can get a raise. Of course, this may mean you need to produce more on your job or work extra hours. You can try to find another job with better pay.

    Research the job market and see what other companies are paying for your position and see if there is a high demand for what you do. You can consider getting a college degree if you don't have one or getting certificates that are required to move up the corporate ladder in your field, or getting a part-time job on the weekend if that works.

No matter how little extra payments you make each month, they help you pay off your mortgage faster. You can always start small, and increase your monthly payment as times go by. If you think long-term, you are saving money and building equity on your house much quicker when you pay more.

Should I pay off my mortgage?

There are a few reasons when it comes to why you wouldn't want to pay off your mortgage.

  • Other better investment - If you have other investment opportunities that have a better growth rate or higher ROI for your money than the interest you are paying for the mortgage, by all means, pursue these opportunities.

  • Starting a business - if you are thinking about starting a business and need the capital, you may not want to pay off your mortgage. You may need the extra money for your business.

  • The interest rate is very low - If you want to live more comfortably and spend more time with your family instead of getting another job. You may not want to pay off your mortgage earlier as that would mean a change in your lifestyle.

Everyone and every family is different. Some want to pay off their mortgage as quickly as possible, while others want to have more cash in hand for other use. You will have to do some thinking and planning to decide whether or not it makes sense to pay off your mortgage faster.

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