Loan Payoff Calculator
Enter your balance, interest rate and monthly payment to see when the loan is paid off, and how much time and interest an extra monthly payment saves.
How the loan payoff calculator works
Each month, interest is charged on the remaining balance. Your payment first covers that interest and the rest reduces the balance. Because a lower balance means less interest next month, even a small extra payment shortens the loan and cuts the total interest.
Enter your current balance, annual interest rate and regular monthly payment. Then add an extra amount to see the payoff time and total interest with and without it. If your regular payment is smaller than one month of interest, the balance never goes down and the calculator tells you so.
Check with your lender that extra money is applied to the principal and that there is no prepayment penalty.
The formulas
Example: A $15,000 balance at 7.5% with a $350 monthly payment takes 51 months to pay off and costs $2,514.21 in interest. Paying $100 extra a month ($450 in total) finishes in 38 months with $1,873.13 of interest, which is 13 months sooner and $641.08 less interest.
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Frequently asked questions
How do extra payments shorten a loan?
Extra money reduces the principal right away, so less interest is charged in later months. The saving grows the earlier you start.
Should I tell my lender the extra payment is for principal?
Yes. Some lenders apply extra money to the next payment or to future interest unless you ask for it to go to principal. Check your loan terms.
Is there a penalty for paying a loan off early?
Some loans have prepayment penalties. Read your loan agreement or ask the lender before paying extra.
Which debt should I pay off first?
Paying the highest-interest debt first saves the most money, while paying the smallest balance first can feel motivating. Pick the method you will stick with.
Why does the calculator say my payment is too low?
If the monthly payment is not larger than one month of interest, the balance cannot go down. Raise the payment or contact the lender.
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