How extra mortgage payments work

Extra principal

Monthly, annual, and one-time extras are voluntary principal. The schedule applies each one on the date you set, if a balance is still outstanding. Paying extra principal reduces later interest because interest is calculated on a smaller balance.

You can limit the monthly or annual extra to a range of dates. “Until payoff” keeps it in the schedule until the balance is gone. The insights panel can also suggest one extra-payment example. Applying that suggestion fills the extra-principal field. It does not change the formula.

The monthly payment line stays put

The large monthly figure is the housing payment: scheduled principal and interest, plus taxes and costs when those are included. Extra principal is shown in the schedule as its own column. Adding it into the headline payment would mix a voluntary payment with the contractual one.

Lifetime interest and the payoff date do respond to extra principal. Those are the fields to watch when you are testing a prepayment.

Biweekly and twice monthly

Twice monthly pays half of the contractual principal and interest on the 1st and the 15th. Biweekly pays half of that amount every 14 days. Biweekly interest uses the actual number of days and a 365-day year.

In both accelerated schedules, escrow and mortgage insurance are modeled on the first draft of a calendar month, not on every draft. A servicer may not offer these drafts. The calculator warns about that when biweekly is selected.

Prepayment is not always free

This model does not add a prepayment penalty. A real note might. The estimate also assumes the extra payment is applied to principal. A servicer that holds it as a future payment would produce a different balance than the schedule.

Needs review before launch. Prepayment penalties and servicer application rules are not modeled. Do not describe this schedule as a promise of how a servicer will apply a payment.

Try it in a calculator

Related guides

• How mortgage payments are calculated
• What affects monthly mortgage costs?
• How down payments affect mortgages

Read the methodology

Written to explain how this site’s calculators work. Not a review by a licensed mortgage professional, and not a recommendation to borrow. These notes are not financial, tax, or legal advice.