Your loan
Stack your strategies
Each bar is how long the loan lasts. Shorter is better. Your current choice has the orange outline.
Why every 2 weeks works: a year has 52 weeks, so you make 26 half payments. That equals 13 full payments, one more than the 12 you owe. Paying twice a month (24 half payments) is the same as paying monthly and does not save anything.
Watch the balance fall faster
Your loan balance over time. The orange line includes your extra payment. The shaded gap is time you no longer owe anything.
The payments you never make
Why a little extra goes so far
Early in a mortgage, most of each payment is interest. Extra money skips the interest and goes straight to what you owe.
- Interest is paid firstEach month the bank charges interest on the balance you still owe.
- Extra hits principalAnything above your required payment lowers the balance right away.
- The snowball startsA lower balance means less interest next month, so more of every payment pays down the loan.
Year-by-year schedule
| Standard | With extra | |||
|---|---|---|---|---|
| Year | Interest paid | Balance at end | Interest paid | Balance at end |
Estimates for illustration only. Figures cover principal and interest on a fixed-rate loan and leave out property taxes, homeowners insurance, mortgage insurance, and HOA dues. Before you pay extra, confirm your loan has no prepayment penalty and ask your servicer to apply the extra amount to principal. The every-2-weeks option is modeled as one extra full payment a year applied to principal. Some servicers charge a fee for formal bi-weekly programs or hold half payments until a full payment arrives; you get the same result by adding 1/12 of your payment to each monthly payment.
This is not an offer to extend credit or a commitment to lend. Not all customers will qualify. All products are subject to credit, underwriting, and property approval. Programs, rates, terms, and conditions are subject to change without notice. Not available in all states. Standard Mortgage Capital, LLC dba Rize Mortgage is not affiliated with any government agencies. Equal Housing Lender.