Loan Payoff Calculator
A payoff estimate answers two questions: when the balance reaches zero, and how much interest you pay to get there. Adding a recurring extra payment changes both, often by more than borrowers expect.
Loan payoff estimate
How the estimate works
- Monthly interest equals the outstanding balance times the annual rate divided by 12.
- Principal applied equals the total payment, including any extra amount, minus that month's interest.
- The balance is reduced and the process repeats until it reaches zero, which gives the payoff month.
- Interest saved equals total interest on the scheduled plan minus total interest with extra payments.
Check the loan terms first
Prepayment penalties, precomputed interest, variable rates, deferred interest, and lender-specific payment application rules can change the outcome. Results are estimates only and are not lending or financial advice.
Assumptions and review
Formula review: July 29, 2026. Uses monthly interest and principal reduction with a 100-year safety cap.
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Frequently asked questions
How do extra payments reduce loan interest?
Interest accrues on the outstanding balance, so any payment above the scheduled amount goes directly to principal and permanently removes all future interest that balance would have generated. Earlier extra payments save more than later ones.
What is an amortization schedule?
An amortization schedule lists every scheduled payment and shows how much of each one goes to interest versus principal, along with the remaining balance. It is the clearest way to see when a loan actually gets paid off.
How do I pay off a loan faster?
Add a fixed extra amount to each payment, switch to biweekly payments to make one extra full payment per year, apply windfalls directly to principal, or refinance to a lower rate while keeping the same payment amount. Confirm the lender applies extra funds to principal rather than to future installments.