David Chen is a Certified Financial Analyst with over 10 years of experience in mortgage management.
Enter the necessary values to calculate your extra mortgage payment and its impact on your monthly payment.
Extra Mortgage Payment Calculator
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Extra Mortgage Payment Formula
Monthly Payment = [P * r * (1 + r)^n] / [(1 + r)^n - 1]
P = Principal, r = Monthly interest rate, n = Number of payments
Formula Source: Investopedia
Variables
- P: Principal loan amount
- r: Monthly interest rate
- n: Number of monthly payments
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What is Extra Mortgage Payment?
An extra mortgage payment is an additional payment made towards your mortgage principal. By doing so, you can reduce your mortgage balance more quickly, leading to reduced interest costs and potentially shortening the term of the loan.
How to Calculate Extra Mortgage Payment (Example)
- Enter the loan principal, interest rate, loan term, and extra monthly payment.
- Click “Calculate” to see the effect of the extra payment on your mortgage.
- The calculation will show how much interest you save and how much quicker your loan will be paid off.
Frequently Asked Questions (FAQ)
What happens when I make extra mortgage payments? Extra payments reduce your mortgage balance faster, helping you pay off your loan early and saving on interest.
Can I make extra payments on my mortgage every month? Yes, most mortgages allow you to make extra payments without penalties, but you should confirm with your lender.
Does an extra payment reduce my monthly payment? No, your monthly payment stays the same, but you reduce the total interest and loan term.