How Much Extra Should You Pay on Your Mortgage? Payoff Calculator Guide

Every extra dollar you put toward your mortgage principal earns you a guaranteed return equal to your interest rate. At 6.7%, that's better than most savings accounts and competitive with stock market returns — with zero risk. But how much extra should you pay? Let's look at the real numbers.

The Baseline: No Extra Payments

We'll use a $350,000 mortgage at 6.7% on a 30-year fixed as our baseline. Here are the numbers without any extra payments:

You'd pay more in interest ($460,720) than the house cost ($350,000). That's the cost of borrowing for 30 years. Extra payments attack that interest directly.

Extra $100/Month: The Low-Effort Option

Adding just $100/month to your payment ($2,352 total):

For the cost of a monthly streaming bundle, you save over $50,000. That's because every extra $100 goes straight to principal, reducing the balance that interest is calculated on for every future month.

Extra $200/Month: The Sweet Spot

Doubling the extra payment to $200/month ($2,452 total):

An extra $200/month saves nearly $90,000 in interest and has you mortgage-free almost 6 years early. That's a car payment's worth of extra money each month — and it buys back 6 years of financial freedom.

Extra $500/Month: The Aggressive Route

If you can swing $500/month extra ($2,752 total):

This is transformative. You save over $161,000 and knock more than a decade off your mortgage. Your 30-year loan becomes an 18.6-year loan. You'd own your home free and clear before your kids start college.

Side-by-Side Comparison

The relationship isn't linear — $500 extra saves 18× more interest than $100 extra, even though it's only 5× the payment. That's exponential compounding working in your favor for once.

What About Lump-Sum Payments?

A one-time extra payment can also make a huge dent. Let's say you get a $10,000 bonus in year 3 and put it toward principal:

A $10,000 lump sum in year 3 saves $35,200 in interest because it reduces your principal for 27 remaining years. The earlier you make extra payments, the more impact they have.

Extra Payments vs Investing: Which Wins?

This is the debate that never ends. The short answer: it depends on your rate vs expected returns.

• If your mortgage is at 6.7%, extra payments earn you a guaranteed 6.7% return — and that return is tax-free if you don't itemize deductions.
• Historical stock market returns average 7–10% — but with significant volatility and no guarantees.
• A balanced approach: match your 401(k) employer match first (free money), then split extra cash between mortgage prepayment and investing.

Either way, know your numbers. Use our mortgage calculator to see your amortization schedule and our payoff calculator to see exactly how extra payments change your timeline.

Pro Tips for Extra Payments

1. Specify apply to principal. Some lenders apply extra payments to next month's interest unless you designate them as principal-only. Always double-check.
2. Check for prepayment penalties. Most modern loans don't have them, but verify before making large extra payments.
3. Be consistent. Setting up automatic extra payments means you don't have to think about it — and you won't skip months.
4. Track your progress. Watching your payoff date creep closer is incredibly motivating. Seeing your PMI drop off sooner is even better — check your timeline with our PMI calculator.

Calculate Your Payoff Timeline

The numbers above are based on a $350,000 loan at 6.7%, but your mortgage is different. Enter your actual balance, rate, and extra payment amount in our mortgage payoff calculator to see your personal savings and new payoff date.