Extra Payment Calculator
Calculate how additional payments can reduce your loan term and save interest
Extra Payment Examples
Home Loan Example
Loan: ₹50,00,000
Rate: 8.5%
Term: 20 years
Extra: ₹10,000/month
Time Saved: 6 years 2 months
Interest Saved: ₹19,23,840
Car Loan Example
Loan: ₹8,00,000
Rate: 10%
Term: 5 years
Extra: ₹5,000/month
Time Saved: 1 year 8 months
Interest Saved: ₹89,460
Personal Loan Example
Loan: ₹3,00,000
Rate: 12%
Term: 3 years
Extra: ₹2,000/month
Time Saved: 9 months
Interest Saved: ₹18,596
Extra Payment Impact Formulas
New Balance After Extra Payment
New Balance = Previous Balance - (Regular Payment + Extra Payment)
Extra payments directly reduce the principal amount
Interest Savings
Savings = Original Interest - New Interest
Extra payments reduce both loan term and total interest
Time Saved
Time Saved = Original Term - New Term
Early payments can significantly reduce loan duration
Benefits & Features
Our extra payment calculator provides valuable insights for loan optimization:
Payment Analysis
- Interest savings calculation
- Loan term reduction
- Payment impact analysis
- Early payoff scenarios
- Cost-benefit evaluation
Strategic Planning
- Extra payment scheduling
- Lump sum impact analysis
- Monthly vs annual comparison
- Optimal payment timing
- Budget optimization
Financial Insights
- Total savings projection
- Time saved calculation
- Investment comparison
- Tax benefit analysis
- Long-term impact view
Frequently Asked Questions
How do extra payments reduce my loan term?
Extra payments work by:
- Directly reducing principal balance
- Decreasing future interest charges
- Shortening overall loan duration
- Not changing regular monthly payment
- Creating compound savings effect
When is the best time to start extra payments?
Optimal timing considerations:
- Earlier payments save more interest
- Start after emergency fund is built
- Consider other high-interest debts
- Check for prepayment penalties
- Align with monthly cash flow
Should I make extra payments or invest?
Consider these factors:
- Compare loan interest vs investment returns
- Evaluate risk tolerance
- Consider tax implications
- Factor in emotional benefits
- Balance with other financial goals