How to use this calculator
Use the figures from your latest loan statement.
- Current balance. What you still owe today, not the original loan amount.
- Interest rate. The yearly rate on the loan.
- Current monthly payment. The amount you pay each month now. Use only the principal and interest part. Leave out tax, insurance or other charges collected with the payment.
- Extra monthly payment. The additional amount you could pay every month.
The calculator shows four results: the payoff time with the extra payment, the payoff time without it, the time saved and the interest saved.
Worked example
These are the starting values in the calculator above and the results they give. Change any input to see your own numbers.
- Current balance
- $20,000
- Interest rate
- 7.5%
- Current monthly payment
- $400
- Extra payment per month
- $100
- Payoff time
- 3 yr 11 mo
- Without the extra payment
- 5 yr 1 mo
- Time saved
- 1 yr 2 mo
- Interest saved
- $969
- Total interest
- $3,087
How payoff time is calculated
Each month, interest is charged on the balance you owe. The monthly rate is the yearly rate divided by 12. Your payment covers that interest first, and the rest reduces the balance.
The calculator works out how many payments it takes for the balance to reach zero. It does this twice: once with your current payment and once with your current payment plus the extra amount. The gap between the two is your time saved.
Total interest in each case is the sum of all payments minus the balance you started with. Interest saved is the difference between the two totals.
The payment must be larger than the first month's interest. If it is not, the balance never falls and the loan cannot be paid off. On a $20,000 balance at a 0.5% monthly rate, the first month's interest is $100, so the payment has to be more than $100.
n = −ln(1 − B × r ÷ M) ÷ ln(1 + r)- n
- number of monthly payments until the loan is paid off
- B
- current balance
- r
- monthly interest rate (yearly rate ÷ 12)
- M
- monthly payment (add the extra payment for the faster payoff)
- ln
- natural logarithm
Why extra payments save so much
Extra money goes directly to principal. A lower balance means a smaller interest charge next month, which leaves even more of your regular payment for principal. The effect builds on itself month after month.
- Start early. An extra payment made today saves more than the same payment made later, because it lowers the balance for more months.
- Higher rates save more. The higher the rate, the more interest each extra dollar avoids.
- Be consistent. A modest amount paid every month can remove a meaningful share of the remaining term.
- Check your terms. Some loans charge a fee for early repayment, and some lenders need to be told that extra money should go to principal.
If you have several debts, the order you pay them in also matters. Our guide on debt snowball vs avalanche compares the two common methods. To see a full year-by-year table, use the amortization calculator.
Frequently asked questions
How do I work out how long it will take to pay off my loan?
You need three numbers: the balance, the interest rate and the monthly payment. Each month, interest is added to the balance and the payment is subtracted. The payoff time is the number of months until the balance reaches zero. This calculator runs that math for you, with and without an extra payment, and shows both results.
Does paying extra each month really make a difference?
Yes. Extra payments go straight to principal, so the balance drops faster and less interest is charged in every following month. Over a long loan, even a small regular extra amount can cut months or years from the term. The exact savings depend on your balance and rate, which is what the calculator shows.
Is it better to pay extra monthly or make one lump sum?
Both reduce principal and save interest. In general, the sooner money reaches the balance, the more interest it saves. A lump sum paid today saves more than the same total spread over many months. Regular extra payments are easier for many budgets, though. This calculator models a fixed extra amount paid every month.
Are there penalties for paying off a loan early?
Some loans have a prepayment penalty, which is a fee charged when you repay all or part of the loan ahead of schedule. Many loans have none. The loan agreement states whether one applies and how it is calculated. If there is a penalty, compare it with the interest saved before deciding to pay extra.
Why does my payoff time show as not possible?
That happens when the monthly payment is equal to or less than the interest charged each month. In that case nothing is left to reduce the balance, so the debt never shrinks. To fix it, the payment has to be higher than the monthly interest, which is the balance times the yearly rate divided by 12.
This calculator gives estimates for education only. It does not know your full situation and is not financial advice. Reviewed and updated November 15, 2026.