Any extra money paid toward principal shortens your loan and cuts interest, especially early in the loan. Common approaches are adding a fixed amount each month, making one extra payment a year (or paying biweekly), and applying windfalls. Before prepaying, make sure you have an emergency fund, are saving for retirement and have no higher-interest debt.
How much extra payments save
On a $350,000 loan at 6.5% for 30 years, the regular payment is about $2,212:
| Extra each month | Paid off in | Interest saved |
|---|---|---|
| $100 | about 26½ years | about $63,000 |
| $250 | about 22½ years | about $127,000 |
| $500 | about 18½ years | about $194,000 |
Ways to pay extra
- A fixed monthly amount: simplest, and easy to pause.
- Biweekly payments: half a payment every two weeks adds up to 13 full payments a year. Only do it if your servicer applies the money right away and charges no fee. See the biweekly mortgage calculator.
- One extra payment a year, for example from a tax refund or bonus.
- Rounding up your payment.
Make sure extra money is applied to principal, not held for future payments; many servicers have a box or option for this.
Should you prepay?
Prepaying gives you a guaranteed return equal to your mortgage rate. That’s attractive at 6% or 7%, less so at 3%. Consider these first:
- An emergency fund of several months’ expenses.
- Retirement savings, especially enough to get any employer match.
- Paying off credit cards and other higher-rate debt.
Money in your home isn’t easy to get back out, so keep enough liquid savings.
Other options
- Recast: pay a lump sum and have the lender recalculate a lower monthly payment over the same term; see recast vs. refinance.
- Refinance to a shorter term if rates are lower; see the refinance break-even tool.
- Reach 20% equity sooner to drop PMI; see how to remove PMI.
See how your loan pays down over time with the amortization schedule.
Common questions
How much does an extra $100 a month save on a mortgage?
On a $350,000 loan at 6.5%, about $63,000 in interest and roughly three and a half years off a 30-year loan.
Are biweekly payments worth it?
They add one extra payment a year, which helps, as long as your servicer applies payments right away and charges no fee.
Should I pay off my mortgage or invest?
Prepaying earns a guaranteed return equal to your rate. Build an emergency fund, get any retirement match and pay off higher-rate debt first.
Updated October 2026. Educational content. OfferBacked is not currently a lender and doesn’t issue pre-approvals or loans.