Loan Payoff Calculator
See how extra monthly payments shorten your loan and save on interest.
How Extra Payments Work
When you make an extra payment, it goes directly toward your principal (what you owe), not interest. This shrinks the balance faster, which means less interest accrues next month — creating a compounding benefit over the life of the loan.
The earlier you start making extra payments, the bigger the benefit — because early payments eliminate months or years of future interest charges.
How Extra Payments Save You Money
Every amount you pay above the minimum goes straight to the principal — the balance you owe — not to interest. Because future interest is charged on that balance, removing principal early stops years of interest before it ever accrues. This calculator shows how much sooner you'd be debt-free and how much interest you'd save.
A Quick Example
On a $20,000 loan at 7% over 5 years, adding just $50 a month can shave months off the term and save hundreds in interest. The effect is largest early in the loan and on high-interest debt, which is why paying extra on a credit card beats paying extra on a cheap mortgage.
Snowball vs Avalanche
With several debts, the avalanche method (pay extra on the highest rate first) saves the most money, while the snowball method (smallest balance first) gives quicker psychological wins. To see a full payment schedule, use the amortization schedule.