The fastest way to save on a mortgage is not a refinance — it is paying a little extra toward principal. Because interest is calculated on the remaining balance, every extra dollar compounds into real savings.
On a $400,000 loan at 6.5% for 30 years, an extra $100 a month saves about $70,000 in interest and cuts the term by roughly 4 years. An extra $300 saves far more.
Every extra dollar reduces the balance, which reduces next month's interest, which means more of your regular payment goes to principal. It is a positive feedback loop.
Always specify that the extra amount goes to principal, not future payments. Prepaying interest earns you nothing.
If you have higher-interest debt (credit cards), pay that first. A 6.5% mortgage is cheap compared to 20% credit-card interest.
Use the extra payment field on our calculator and watch the interest-saved number move in real time.
Reading is step one. Step two is running your own numbers — taxes, insurance, PMI and all.
Open the mortgage calculator