Loan Prepayment Calculator
See how much interest and time a one-time extra payment saves when you keep the monthly payment the same and let the loan finish early.
Why paying down early pays off
Putting a lump sum straight onto the principal, while keeping the same monthly payment, means more of every future payment goes to the balance instead of interest. The loan clears sooner and the total interest drops.
An extra payment early in the loan saves the most, because that's when interest makes up the bulk of each payment. This assumes the payment stays the same and the term shrinks. Compare it against the original loan in our finance calculators.
Common questions
Should I lower the payment or shorten the term?
Shortening the term usually saves far more interest than trimming the payment, since you finish the loan sooner. This calculator assumes you keep the payment and end the loan early.
When does an extra payment help most?
Early on. In the first years most of your payment is interest, so cutting the balance then removes the most future interest. The benefit shrinks as the loan ages.
Are there prepayment fees?
Some loans let you pay extra for free; others charge a fee, fixed-rate loans especially. Check your loan agreement before making a large extra payment.