Extra payment calculator: shorten your loan and save interest
An extra payment that goes straight to capital lowers the balance interest is charged on. Here is how much difference it can make.
How extra payments save interest
Interest is charged on the capital you still owe. If you pay extra capital early, every later month is charged on a smaller balance. If you keep the same monthly payment, the loan simply ends sooner.
Worked example
| Capital | 100,000 |
|---|---|
| Yearly rate | 12% |
| Term | 24 months |
| Monthly payment | 4,707.35 |
| Total interest without extra | 12,976.33 |
Now add one extra capital payment of 10,000 in month 6 and keep the same monthly payment:
| Loan ends after | 22 months (2 months earlier) |
|---|---|
| Total interest | 11,111.19 |
| Interest saved | 1,865.15 |
The earlier you pay extra, the more interest you save. Check first that your lender applies extra payments to capital and does not charge a prepayment penalty.
Track extra payments in Loan Reminder App
- Record an extra capital payment and a note when you mark a month as paid.
- See the impact on remaining capital and interest.
- Include extra payments and notes in the PDF you export.
Frequently asked questions
Does an extra payment reduce the monthly payment or the term?
It depends on the lender. With the payment unchanged, the loan ends sooner. Some lenders recalculate the payment instead. Ask yours.
Is there a penalty for paying early?
Some contracts have a prepayment fee. Check your loan agreement.
Can I add a note to an extra payment?
Yes. Loan Reminder App lets you add a note and an extra capital amount to each payment.
Open the free web app, add a loan, and see your schedule, interest and the effect of extra payments.
Open Loan Reminder App