Early Loan Payoff Calculator, Lump Sum

On a $25,000 loan at 8% with 60 months left, one $5,000 payment after 12 months ends it 1 year 1 month sooner and saves $1,607 of interest.

Enter your own loan and lump sum, then read the table for other amounts and dates.

Lump sum loan payoff calculator

Payoff with no lump sum: 5 years, $5,415 of interest.

Payoff with the lump sum: 3 years 11 months, $3,808 of interest.

You save $1,607 of interest and finish 1 year 1 month sooner.

Amount and timing

The loan is $25,000 at 8% with 60 months left, a payment of $506.91. With no lump sum it ends in 5 years and costs $5,415 in interest. Each cell shows the interest saved and how much sooner the loan ends.

Lump sumPaid after 6 monthsPaid after 12 monthsPaid after 24 months
$2,500$1,009 saved, 6 months sooner$874 saved, 6 months sooner$621 saved, 6 months sooner
$5,000$1,863 saved, 1 year 1 month sooner$1,607 saved, 1 year 1 month sooner$1,120 saved, 1 year sooner
$10,000$3,160 saved, 2 years 1 month sooner$2,687 saved, 2 years 1 month sooner$1,785 saved, 1 year 11 months sooner

Before you pay early

The CFPB says a prepayment penalty is a fee that some lenders charge if you pay off all or part of your mortgage early.

Other loans set their own terms, so ask your lender whether yours charges a fee and how to send the money. For extras every month see the loan payoff calculator with additional payments.

Frequently asked questions

What does a lump sum do to my loan?

It removes that amount from the balance at once. With a fixed payment the loan ends sooner, and every month after it is charged interest on a smaller balance.

How much does a $5,000 lump sum save?

On the example loan, $5,000 paid after 12 months ends it 1 year 1 month sooner and saves $1,607 of interest.

Is it better to pay a lump sum early or late?

Early. The same amount saves less each month you wait, because it removes interest for fewer months. The table shows 6, 12 and 24 months.

Does a lump sum lower my monthly payment?

Not on its own. The required payment stays the same and the loan ends sooner. Some loans can be re-amortized after a lump sum to lower the payment; ask your lender.

Does this work for every loan?

It fits a fixed-rate loan that charges interest on the balance each month. It does not fit a loan with precomputed interest, where an early payoff may not save what the calculator shows.

Sources

Every figure on this page comes from the pages below. Checked 2026-11-12. Rules change, so confirm with your own servicer.

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