Months Saved
110
Loan Analysis Calculator
Analyze the impact of extra payments on a loan's payoff time and cost.
Interest Saved
$135,115.17
New Payoff Time
20.8 yrs
Original Total Interest
$382,633.47
New Total Interest
$247,518.30
How to use the Loan Analysis Calculator
The Loan Analysis Calculator is free and runs entirely in your browser — no sign-up, and nothing you enter leaves your device. It opens pre-filled with a realistic example, so you can see how it works before replacing any figure with your own; the results update as you type. Press Calculate to refresh the result panel, or Reset to return to the example.
The inputs it asks for:
- Loan Amount — a dollar amount.
- Annual Interest Rate — a percentage (enter 6 for 6%).
- Term (Years) — a number.
- Extra Monthly Payment — a dollar amount.
The formula
It amortizes the loan twice — once as scheduled, once with your extra monthly payment applied straight to principal — and reports the interest and time the extra payments save:
Interest saved = Interest (scheduled) − Interest (with extra)
Months saved = Payoff months (scheduled) − Payoff months (with extra)- Extra
- an additional amount added to every monthly payment, all applied to principal
Every extra dollar cuts the balance that future interest is charged on, so the savings compound — a modest extra payment can shorten a long loan by years. The gain is largest early in the loan, when interest makes up most of the payment.
Worked example
Using the example values — Loan Amount $300,000.00, Annual Interest Rate 6.5%, Term (Years) 30, Extra Monthly Payment $300.00 — the Loan Analysis Calculator returns a Interest Saved of $135,115.17. It also reports Months Saved (110), New Payoff Time (20.8 yrs), Original Total Interest ($382,633.47).
Prefer your own numbers? Change any field above and this recomputes instantly.
Key terms
- Principal prepayment
- An extra payment applied directly to the balance, not interest.
- Amortization
- The scheduled split of each payment between interest and principal.
- Payoff time
- How long until the balance reaches zero.
Frequently asked questions
Why does a small extra payment save so much?
Because it goes entirely to principal, and every dollar of principal removed saves all the future interest it would have generated. Over a long term those savings compound.
When do extra payments help most?
Early in the loan, when the balance — and therefore the interest portion of each payment — is highest. The same extra payment later saves less.
Should I always prepay?
Not necessarily. Compare the loan's rate to what the money could earn elsewhere, and check for prepayment penalties. High-rate debt is usually worth prepaying; low-rate debt may not be.