This mortgage payoff calculator figures the extra payment necessary to...show instructions Mortgage rates can't get much lower! It's the perfect time to apply whether you hope to buy or refinance. Check today's best available mortage rates and see which lenders are taking new
applications: See Today's Best Available Rates → You dream of paying off your mortgage early. You long for the day when you are debt free. But how do you do it? How much must you pay each month to be out of debt by a certain date? What if you wanted to pay off your mortgage in 15 years instead of 30? How much would you save? The good news is this mortgage payoff calculator makes figuring out your required extra payment easy. You choose how quickly you'd like to pay off your mortgage, and the calculator will tell you the required extra monthly payment to get it done. It will also tell you how much interest you'll save! However, before you start making your extra payments, there are a few factors you'll want to consider first . . . . Factors To Consider When Paying Off The Mortgage EarlyLiving without any debt is an exciting goal, but paying off your mortgage needs to be done right. Here are some important considerations:
Once you've determined that you're ready to pay off your mortgage, it's time to start reaping the benefits! Related: 5 Financial Planning Mistakes That Cost You Big-Time (and what to do instead!) Explained in 5 Free Video Lessons Benefits Of Paying Off Your Mortgage EarlyOwning a home without a mortgage is financially liberating. Here are just a few of the key benefits:
Pitfalls Of Paying Off Your Mortgage EarlyMany homeowners think that they should pay off their mortgage early to get out of debt, but does it always make sense? You do not want to pay off your mortgage and end up low on cash. It's much easier to take cash out of a checking account when needed than it is to refinance by pulling it out of your home loan. Ask yourself if you'll need liquid cash in the near future. If the answer is yes, you're better off putting your extra money in savings – not toward your mortgage. Always have a small savings buffer to help you pay for immediate expenses. Final ThoughtsThere are many competing financial goals to consider first before committing to an early mortgage payoff program. From paying off high-interest credit cards, to starting your retirement contributions, to getting important insurance policies in place, there are many financial goals that should probably take priority over paying off your mortgage early. You must build a solid financial foundation first. However, if you're ready to pay off your mortgage early then this calculator will help you reach your goal. Pay off your mortgage in 15 years, 10 years, 5 years, or whatever amount of time makes sense for you and your budget! Mortgage Payoff Calculator Terms & Definitions
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Next StepsMortgage rates can't get much lower! It's the perfect time to apply whether you hope to buy or refinance. Check today's best available mortage rates and see which lenders are taking new applications: See Today's Best Available Rates → How much does an extra principal payments reduce my mortgage?Shorten the loan term
(EXAMPLE: Consider your loan amount is $300,000 with an interest rate of 4% and a 30-year loan term. If you pay $150 additional toward the principal each month, you can expect to save $40,282 and pay off your mortgage almost 5 years earlier.)
How do I figure out my mortgage payoff amount?You can calculate a mortgage payoff amount using a formula Work out the daily interest rate by multiplying the loan balance by the interest rate, then multiplying that by 365. This figure, multiplied by the days until payoff, plus the loan balance, gives you your mortgage payoff amount.
Is it smart to pay extra principal on mortgage?A little goes a long way
Making your normal monthly payments will pay down, or amortize, your loan. However, if it fits within your budget, paying extra toward your principal can be a great way to lessen the time it takes to repay your fixed-rate loan and the amount of interest you'll pay.
What happens if I pay 2 extra mortgage payments a year?This is equivalent to 12 slightly-higher monthly payments of $1,252.85 — but this small difference is enough to pay off your full debt in just 22 years and cost you only $129,712.85 in interest. In other words: two extra mortgage payments per year will save you eight years and $56,798.72 in interest.
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