Dave Ramsey Mortgage Payoff Calculator Explained
Ramsey's mortgage payoff calculator shows how early you will pay off your mortgage and how much interest you will save.
To run the same arithmetic yourself you need a balance, a payment and an extra amount per month. It is the standard loan formula, so the table and the calculator on this page check any result.
What to enter
- Your remaining balance, from the latest mortgage statement.
- Your monthly payment, without taxes and insurance. In its payoff calculator, Ramsey defines your mortgage payment as your principal and interest payment.
- The extra amount you can add every month.
Leave escrow out of the payment: it pays your tax and insurance bills and does not reduce the balance.
A loan you can check
The loan is $200,000 at 6.5% over 30 years, a payment of $1,264.14 (principal and interest). With no extra it takes 30 years and costs $255,089 in interest.
| Extra a month | Paid off in | Sooner by | Interest paid | Interest saved |
|---|---|---|---|---|
| $100 | 24 years 5 months | 5 years 7 months | $199,143 | $55,946 |
| $300 | 18 years 3 months | 11 years 9 months | $141,557 | $113,532 |
| $500 | 14 years 9 months | 15 years 3 months | $110,941 | $144,148 |
| $1,000 | 10 years 1 month | 19 years 11 months | $72,852 | $182,237 |
The extra amount goes to principal on the due date each month. The rate and the required payment do not change.
Extra payment payoff calculator
Payoff with no extra: 25 years, $200,249 of interest.
Payoff with the extra: 19 years 9 months, $152,654 of interest.
You save $47,596 of interest and finish 5 years 3 months sooner.
Ramsey's own example
Ramsey says making extra payments on the principal balance of your mortgage will help you pay off your mortgage debt faster.
One example on Ramsey's page is a $200,000 balance and a $993 payment on a 30-year fixed-rate loan, where $300 extra each month saves just over $64,000 in interest.
That example has a different rate and years left from the table above, so the figures differ. The pattern is the same: a steady extra amount on a large balance saves interest every month it runs. See extra payments and mortgage payoff for one-time payments and when they land.
Before you pay extra
- Ask your servicer to apply the extra money to principal, not to the next payment.
- Read your loan papers for a prepayment penalty. Ramsey defines a prepayment penalty as a fee that can be charged if your mortgage is paid down or paid off early.
- If a lower payment matters more than an earlier payoff, a recast does that instead. Compare them in recast vs extra principal payment.
Frequently asked questions
Which payment do I enter in a mortgage payoff calculator?
Enter principal and interest only. Taxes, insurance and mortgage insurance are paid on top of it and do not reduce your balance, so leaving them in makes the payoff look slower than it is.
Why does my servicer's payoff date differ from a calculator's?
A calculator assumes the extra money lands on principal on the due date every month. Your servicer may apply it later, or to the next payment, and rounding of the rate and the payment adds a few dollars. Ask how extra money is applied before you rely on a date.
Is an extra payment better early or late in the loan?
Early. Interest is charged on the balance, so a dollar that goes to principal in year 2 saves interest for 28 more years, and in year 25 for only 5. The same extra amount saves the most when the balance is highest.
Does paying extra lower my required monthly payment?
No. The required payment stays the same and the loan ends sooner. To lower the payment after a large extra payment you need a recast, which is a separate request to your servicer.
How do I check a payoff calculator's answer by hand?
Use the standard loan formula for the payment, then add the extra to it and count the months until the balance reaches zero. In a spreadsheet, NPER(rate/12, -(payment + extra), balance) gives the months. On the example loan the payment is $1,264.14 and $300 extra a month ends the loan after 18 years 3 months.
Sources
Every figure on this page comes from the pages below. Checked 2026-11-05. Rules change, so confirm with your own servicer.
- Ramsey Solutions: Mortgage Payoff Calculator (what the calculator shows, how it defines the payment, its example and the prepayment penalty definition)
More recast guides
- Free Mortgage Recast Calculator - enter your own loan and see the new payment.
- Recast vs Refinance Calculator - Compare both options on the same loan, with a break-even point.
- Recast Fees and Rules by Lender - Fees, minimums and loan limits published by four large lenders.
- How to Calculate a Recast Payment - The formula, a step-by-step example and the numbers to check.
- How Much Will a Recast Lower My Payment? - The lump sum divided by balance shortcut, with lookup tables.
- Recast vs Extra Principal Payment - The same lump sum two ways: payment, payoff date and interest.
- Recast Amortization Schedule - Balance and interest by year, before and after a recast.
- Chase Mortgage Recast Calculator - No stated minimum, what the lender page says and what a lump sum does.
- Wells Fargo Mortgage Recast Calculator - The jumbo loan recast option, the $10,000 starting point and the rate used.
- Bank of America Mortgage Recast Calculator - Eligibility, timing and an estimate the lender will not give you.
- Best Mortgage Recast Calculator: What to Check - Seven checks and a test loan with the right answer.
- Mortgage Recast Calculator in Excel or Google Sheets - Cell-by-cell layout with PMT, interest saved and a fee break-even.
- How Much Does a Mortgage Recast Cost? - What lenders publish about the fee, and months to pay it back.
- Mortgage Recast Savings Calculator - Monthly saving, interest saved and the net after a fee, by lump sum.
- Home Loan Recast Calculator - The three numbers to enter and three worked loans.
- What Is a Mortgage Recast? - What changes, what stays the same, with a worked example.
- Extra Payments Mortgage Payoff Calculator - New payoff date and interest saved, for monthly extras and one-time payments.
- Amortization Schedule for a Balloon Mortgage - Balance by year and the balloon due at the end of a 5, 7 or 10-year term.