Determine How Much Interest You Could Save By Increasing Your Mortgage Payments
How much interest can you save by increasing your mortgage payment? This financial calculator helps you find out.
The graph shows how much you can save in interest payments and how much sooner you could payoff you mortgage.
How to Use the Mortgage Payoff Calculator
- Enter your information in the fields below. (See the definitions below the calculator for more information on each field).
- Once you have entered all information and selected your options, press the View Report button to see a mortgage amortization schedule.
*Assuming the interest rate does not change during the amortization period.
Definitions
- Original mortgage amount
- The original amount financed with your mortgage, not to be confused with the remaining balance or principal balance.
- Interest rate
- Annual interest rate for your mortgage. All Canadian mortgages use semi-annual compounding of interest.
- Amortization period
- The number of years over which you will repay your mortgage. The most common amortization periods are 20 years and 25 years.
- Accelerated weekly and bi-weekly payments
- Accelerated weekly and accelerated bi-weekly payment options are calculated by taking a monthly payment schedule and assuming only four weeks in a month.
- We calculate an accelerated weekly payment by taking your normal monthly payment and dividing it by four. Since you pay 52 weekly payments, by the end of a year you have paid the equivalent of one extra monthly payment. This additional amount accelerates your loan payoff by going directly against your loan’s principal. The effect can save you thousands in interest and take years off of your mortgage.
The accelerated bi-weekly payment is calculated by dividing your monthly payment by two. You then make 26 bi-weekly payments. Similar to the accelerated weekly payments you are in effect making two additional payments per year.
- Number of years remaining
- This is the total number of years you have left to pay on your mortgage. The earlier you start your payoff plan, the more interest you can save. Just starting a few years earlier can really add up.
- Prepayment type
- The frequency of prepayment.
- Additional payment
- The additional amount that you will pay on your mortgage. This amount will be applied to the mortgage principal balance, based on the prepayment type.
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Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.
