Loan Payoff Calculator
Track your interest savings. Discover the exact month you will be completely debt-free by setting up extra recurring payments.
Loan Details
Accelerated Savings
Redirecting your saved monthly payments ($0/mo) for the 0 years you saved at a 7% annual return accumulates this wealth.
Accelerate Your Loan Payoff Date
Our Loan Payoff Calculator is built to determine the exact month you will become debt-free by making additional monthly principal prepayments. By targeting your principal balance directly, you reduce the underlying amount upon which interest is calculated, accelerating your payoff.
How Loan Prepayment Saves Interest
Installment loans compound interest monthly on the outstanding balance:
When you make an extra payment, 100% of that extra amount goes directly to paying down the principal balance. This reduces the balance faster, which in turn reduces the interest charged in all following months. For details on consumer loans, check the Consumer Financial Protection Bureau (CFPB) website.
Worked Numerical Example
Consider a loan of $60,000 at a 7.5% interest rate over a 10-year term, with an extra payment of $150/month:
- Loan Principal: $60,000
- Interest Rate: 7.5% (APR)
- Term: 10 Years (120 Months)
- Standard Monthly Payment: $712.68
- Extra Monthly Payment: $150.00
| Payoff Option | Monthly payment | Total Interest Paid | Total Cost of Loan | Payoff Timeline |
|---|---|---|---|---|
| Standard Schedule | $712.68 | $25,521.60 | $85,521.60 | 10.0 Years |
| Accelerated Prepayment | $862.68 | $18,412.12 | $78,412.12 | 7.8 Years |
| Total Savings | +$150.00 / month | $7,109.48 Saved | $7,109.48 Saved | 2.2 Years Saved |
When to Use This vs. Our Other Calculators
To select the most appropriate calculator for your planning:
- Use the Loan Calculator to model standard amortizing installment loans with simple extra monthly payments.
- Use the Loan Interest Calculator if you want to focus specifically on minimizing the total interest paid.
- Use the Amortization Schedule Calculator to view your full month-by-month balance reduction breakdown.