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US Prepayment Simulator

See exactly how extra lump-sum payments reduce your mortgage payoff date and how much interest you save over the life of your loan.

Loan Details

$
$100,000$3,000,000
$
$19,500$650,000
%
0.5%15%
yrs
5 yrs30 yrs

Prepayment

$
$0$520,000
Most lenders allow 10–20% of your original mortgage balance as prepayment privileges each year without penalty. Check your specific mortgage agreement for exact limits.

Balance Comparison

Over 25 years
Without Prepayment
With Prepayment

Impact Summary

Interest Saved

$93,471

Total prepayments: $100,000

Years Saved

5.4 yrs

Payoff Without Prepay

August 2051

Payoff With Prepay

August 2045

Total Cost Without Prepay

$901,991

Total Cost With Prepay

$806,559

Monthly Payment

$3,007

PilotRate provides educational mortgage estimates and does not constitute financial advice.

US Mortgage Prepayment — Frequently Asked Questions

Can I pay off my US mortgage early without penalty?
Most conventional US mortgages do not have prepayment penalties, especially conforming loans backed by Fannie Mae or Freddie Mac. However, some FHA loans and subprime mortgages may include prepayment penalties. Always check your promissory note. Our calculator shows how extra principal payments reduce your loan term and total interest.
How much can I save by making extra mortgage payments in the US?
Making one extra mortgage payment per year on a $400,000 30-year loan at 6.5% can save over $70,000 in interest and shorten your loan term by nearly 5 years. Even an extra $100 per month makes a significant difference. Our prepayment simulator shows the exact savings for your specific loan scenario.
What is the difference between paying extra principal and recasting?
Making extra principal payments reduces your loan balance and shortens your term, but your monthly payment stays the same. Recasting involves making a large lump-sum payment and having the lender re-amortize the loan, which lowers your monthly payment while keeping the same term. Not all loans qualify for recasting.
Should I invest extra money or pay down my mortgage?
The decision depends on your mortgage rate versus expected investment returns. If your mortgage rate is 6.5% and you expect 8% from investments, investing may be better after accounting for the mortgage interest tax deduction. However, paying down your mortgage provides a guaranteed return and reduces financial risk. Many homeowners do a combination of both.
How does paying extra principal affect my amortization schedule?
Extra principal payments reduce the outstanding balance faster, which means less interest accrues in future months. This causes more of each subsequent payment to go toward principal. Our calculator generates an amortization schedule showing the impact of extra payments month by month.