Mortgage APR Calculator
This calculator compares a true bi‑weekly amortization schedule (26 payments per year) with a standard monthly schedule (12 payments per year). It computes periodic payments, total interest paid over the loan, effective annual rates, and estimated time and interest savings when switching to bi‑weekly payments.
Results are derived from standard amortization formulas for fixed‑rate loans and show both periodic payment amounts and aggregate totals. Use the inputs to model the loan amount, nominal annual rate (APR), loan term, and any consistent extra payment applied each period.
Compute both schedules and show interest and time differences. This method repeats the amortization formulas for direct comparison.
Inputs
Advanced inputs
Extra payment options
Results
Bi‑weekly payment
$660.73
Monthly payment
$1,432.25
Total interest (bi‑weekly)
$215,369.52
Total interest (monthly)
$215,608.52
Interest savings (monthly → bi‑weekly)
$239.00
Estimated time saved
0
| Output | Value | Unit |
|---|---|---|
| Bi‑weekly payment | $660.73 | USD |
| Monthly payment | $1,432.25 | USD |
| Total interest (bi‑weekly) | $215,369.52 | USD |
| Total interest (monthly) | $215,608.52 | USD |
| Interest savings (monthly → bi‑weekly) | $239.00 | USD |
| Estimated time saved | 0 | years |
Visualization
Methodology
We use fixed-rate amortization formulas where periodic_rate = nominal_annual_rate/periods_per_year and periodic_payment = (r*PV)/(1-(1+r)^-n) when the rate is positive. For zero interest the payment equals principal divided by the number of periods.
Effective annual rate (EAR) for k periods per year is computed as EAR = (1 + periodic_rate)^k - 1. Bi‑weekly schedules use k = 26, monthly uses k = 12.
Comparison is performed by computing both schedules from the same nominal annual rate and loan term, then subtracting total interest and comparing payoff durations. This reflects the mathematical difference from compounding frequency and payment timing; actual savings may vary with lender policies and exact payment application.
Worked examples
Example: $300,000 loan, 4.0% APR, 30 years. Monthly payment computed with periods_per_year=12; bi‑weekly payment computed with periods_per_year=26. The tool outputs both payments, total interest for each schedule, effective annual rate for each compounding frequency, and the interest/time difference.
Further resources
Expert Q&A
Does the calculator compute the legal APR under consumer protection laws?
This tool computes amortization-based effective rates and compares schedules; it does not perform a full statutory APR disclosure calculation that may require fees, points, prepaid interest, or lender charges. For regulated APR disclosures consult your lender's Good Faith Estimate or Truth in Lending statement.
Why do bi‑weekly payments sometimes save interest?
When payments are made more frequently, interest is calculated on a slightly smaller principal between payments, and more frequent contributions toward principal reduce compounded interest. The calculator models true 26‑period compounding and payment timing to illustrate this effect.
Are results exact for every lender?
Results are mathematically exact for fixed-rate loans under the assumptions stated, but lenders may apply payments, fees, or rounding differently. Always confirm payoff and APR details with your lender.
How accurate is this calculator?
Calculations use standard numerical formulas suitable for consumer planning. Follow validation best practices (see citations). Small differences may appear due to rounding conventions, payment posting rules, fees, and escrow. Use results for planning and verification, not as a legal disclosure.
Sources & citations
- National Institute of Standards and Technology (NIST) — https://www.nist.gov
- International Organization for Standardization (ISO) — https://www.iso.org
- Institute of Electrical and Electronics Engineers (IEEE) — https://www.ieee.org
- Occupational Safety and Health Administration (OSHA) — https://www.osha.gov