The math behind paying off a mortgage early
Your regular payment is split into interest (on the current balance) and principal (reducing what you owe). Extra money you add goes 100% to principal — it never accrues interest at all. That shrinks the balance faster, which shrinks next month's interest too, compounding the effect for every month remaining on the loan. This is why extra payments made in year 2 of a 30-year mortgage save dramatically more than the same extra amount made in year 25.
Finding extra money without a big lifestyle change
Even a modest, consistent extra payment adds up. Try the calculator with different amounts — many homeowners find that rounding their payment up to a nearby number, or applying a small raise or tax refund each year, shaves several years and a meaningful amount of interest off a 30-year mortgage without changing their day-to-day budget.
Not sure how big a mortgage you could take on in the first place? Start with the Mortgage Affordability Calculator to work out a comfortable loan size before you buy.
Frequently asked questions
How much does an extra mortgage payment actually save?
Is it better to pay extra monthly or make one lump-sum payment?
Should I pay off my mortgage early or invest instead?
Does refinancing change this calculation?
Last updated: June 2026