Mortgages2 min read · Updated October 19, 2026
Extra mortgage payments: how much interest and time you save
How paying extra on your mortgage cuts interest and years, with a worked example and what to tell your servicer.
How it works
Extra money paid to principal reduces your balance, so every later month charges less interest. Your required payment stays the same and the loan ends sooner.
A worked example
| Required payment | $1,896 |
| Interest with no extra | $382,633 |
| Interest with $200 extra a month | $279,185 |
| Interest saved | $103,449 |
| Time saved | 6 years 11 months |
Make sure it goes to principal
Write "apply to principal" on your payment or use the servicer's extra principal box. Otherwise it may be held as an early payment of next month.
Extra payments or invest
Paying down a 6.5% loan is a guaranteed return of that rate. Compare it with what you could earn elsewhere, keeping in mind that returns elsewhere are not guaranteed.
Common questions
Should I pay extra on my mortgage?
If you have emergency savings and no higher-rate debt, extra principal is a safe way to save interest.
Is there a penalty for paying early?
Most US home loans do not have one, but check your loan documents.
Does an extra payment lower my monthly payment?
Not by itself. It shortens the term unless you recast or refinance.