Mortgage APR Calculator with Extra Payments
This tool helps compare your scheduled mortgage payments to scenarios where you add extra principal payments — either as a recurring monthly addition or a single one-time prepayment. It reports estimated time-to-payoff, total interest paid in each scenario, interest saved and an approximate annualized effective interest rate.
Calculations are intended for planning and comparison. For formal APR disclosures required by law, lenders use regulatory methods (Truth in Lending / TILA) and may include fees and charge timing that this tool does not model. See accuracy and regulatory notes below.
Adds a fixed extra principal contribution to each scheduled payment (same payment frequency as the loan). Calculates months to payoff, interest with and without extra payments, interest saved and an annualized effective rate approximation.
Inputs
Results
Scheduled payment (no extra)
$1,432.25
Estimated payments to payoff with extra
360
Total interest with extra payments
$215,608.52
Total interest without extra payments
$215,608.52
Interest saved
-$0.00
Approximate effective annual rate
239.57%
| Output | Value | Unit |
|---|---|---|
| Scheduled payment (no extra) | $1,432.25 | currency |
| Estimated payments to payoff with extra | 360 | payments |
| Total interest with extra payments | $215,608.52 | currency |
| Total interest without extra payments | $215,608.52 | currency |
| Interest saved | -$0.00 | currency |
| Approximate effective annual rate | 239.57% | % |
Visualization
Methodology
Amortization math uses the standard fixed-rate loan formula to compute the scheduled periodic payment and the remaining balance after a given number of payments. When extra principal is applied, we recalculate the number of remaining payments assuming the same scheduled payment amount plus the extra principal contribution.
For recurring extra payments we estimate payoff using the closed-form solution for the number of payments when payment differs from the original amortizing payment. For a one-time extra we reduce outstanding principal at the chosen payment number and then compute remaining payments on the reduced principal.
APR as defined by consumer regulation (TILA) is a legal disclosure that may include finance charges and certain fees and is solved using root-finding to equate present values. This tool reports an approximate effective annualized interest based on interest paid divided by time to payoff; it is not a regulation-compliant APR calculation.
Worked examples
Example 1: $300,000 loan at 4.0% for 30 years. Scheduled monthly payment is computed; adding $200 extra/month shortens the payoff and reduces total interest. The calculator reports months saved and interest saved.
Example 2: Same loan, make a $5,000 one-time principal payment at payment number 12. The calculator estimates the new remaining schedule, interest saved and an annualized effective interest rate approximation.
Further resources
Expert Q&A
Does this calculator produce the legally required APR disclosure?
No. The calculator provides an approximate annualized effective rate for planning. Legal APR under Truth in Lending (TILA) is a specific disclosure that often includes fees and is solved to equate present values; use your lender's disclosure or consult a formal APR calculation for regulatory purposes.
Can I use this to see how much sooner I will pay off my mortgage?
Yes. For recurring extra payments the tool estimates the number of payments remaining until payoff; for a one-time extra it estimates remaining payments after that payment. Results are estimates and assume payment timing and no additional fees or escrow changes.
Are results exact?
Results use standard amortization formulas and closed-form approximations. They assume a fixed nominal interest rate, no additional fees, no payment holidays, and perfect, on-time payments. Edge cases (zero interest, very small extra payments that do not change schedule) are handled with simple fallbacks. For precise lender statements consult your servicer.
Why is the effective annual rate different from the advertised APR?
Advertised APR (regulatory APR) and an effective annualized interest measure capture different things. APR may include certain up-front fees and uses a regulatory definition; effective annualized interest here is an informational metric derived from total interest paid over time divided by average outstanding principal and annualized. They are not interchangeable.
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
- Consumer Financial Protection Bureau (for Truth in Lending / APR guidance) — https://www.consumerfinance.gov