Loan Repayment Calculator | Pay Off Loans Faster
Calculate how extra payments can help you pay off your loans faster and save on interest with our loan repayment calculator.
Category: Financial
Frequently Asked Questions
How do extra payments help pay off a loan faster?
Extra payments reduce the principal balance directly, which means less interest accrues over time. This accelerates the payoff timeline and reduces the total amount paid over the life of the loan.
Is it better to make biweekly or monthly payments?
Biweekly payments (every two weeks) result in 26 half-payments per year, which equals 13 full monthly payments instead of 12. This extra payment per year can significantly reduce your loan term and total interest paid.
Should I pay off my loan early if there's a prepayment penalty?
It depends on the size of the penalty versus the interest savings. Calculate the total interest you'll save by paying early and compare it to the prepayment penalty to determine if early payoff is financially beneficial.
Which loans should I prioritize paying off first?
Generally, it's best to focus extra payments on loans with the highest interest rates first (the avalanche method) to maximize interest savings. However, some prefer paying off smaller balances first (the snowball method) for psychological motivation.