Mortgage Payoff Calculator

The remaining balance and current principal-and-interest payment determine how the loan pays down from the entered schedule anchor date. Reconstructing a payment from an original amount and term can be wrong after a recast, modification or earlier extra payments. Enter the P&I portion from the current statement; escrowed taxes, insurance and mortgage insurance do not reduce principal and should be left out.

The immediate lump sum is assumed credited to principal on the entered schedule anchor date. Each monthly extra is then added to the regular P&I payment and applied to principal in that same payment period, so the next month starts with a lower balance. Tell the servicer to apply extra funds to principal and verify the statement, because processing and contractual rules can differ.

Not necessarily. The statement balance is unpaid principal. A lender payoff quote can also include interest through the payoff date, unpaid fees, a prepayment penalty or other amounts, and it may have an expiration date. This calculator walks future monthly principal and interest; it is not a quote for wiring money to close the loan today.

Monthly interest is calculated from the outstanding principal. Extra principal lowers that balance sooner, so less interest accrues in later months and more of each regular payment goes toward principal. The calculator compares the same actual P&I payment with and without the entered extras and sums the cent-rounded monthly interest in both schedules.

For the same dollars and rate, principal paid earlier generally avoids more future interest because it reduces the balance sooner. That does not automatically make a lump sum the better household choice: emergency reserves, higher-rate debt, investment risk, taxes and liquidity also matter. This tool compares mortgage arithmetic only.

The calculator trims the last payment to the remaining principal plus that month’s interest. A fixed payment rarely divides the balance into an exact number of months, and extra principal makes an exact division even less likely. The smaller final payment is therefore expected rather than a rounding error.

Yes. Some mortgage contracts can charge a penalty for paying all or a large part of the balance early, and a servicer payoff quote may include other fees. The calculator does not add penalties or fees. Review the note and request an official payoff statement before making a large payment or closing the loan.