Early Payoff Savings Calculator

Calculate interest savings from paying off a loan early. Compare different loan terms and see how much you save.

This calculator compares two fixed loan payments on the same principal — Original Term against a shorter New Term — using the standard amortization formula twice (lines 14-19), then reports the difference in lifetime cost as Total Savings. Months Saved is purely arithmetic: Original Term minus New Term, times 12 (line 31), so it never changes with Loan Amount or Interest Rate at all — take either one 10% under its default value and 10% over it, and Months Saved doesn't budge at all, while doing the same to either term moves Months Saved in lockstep. Total Savings is dominated by Original Term: testing it 10% below its default and 10% above sweeps Total Savings by about 43%, well ahead of Interest Rate (about 25%), Loan Amount (exactly 20%), and New Term (about 18%, the only one of the four that moves Total Savings in the opposite direction — shortening New Term further increases the savings). Original Term dominates because it is the baseline every other input is compared against: stretching it raises the original loan's monthly payment count and total cost simultaneously, compounding through the same exponent that drives the rest of the formula. Unlike some sibling loan calculators in this hub, this engine has no dedicated branch for an exactly-0% Interest Rate: the amortization formula (lines 14-19) divides by (1 + monthlyRate)^n - 1, which evaluates to 0 when monthlyRate is 0, so entering exactly 0% for Interest Rate produces a 0/0 division and a NaN result rather than the simple principal-divided-by-months payment a 0%-rate branch would normally compute — do not assume this calculator handles a 0% rate gracefully just because other calculators in this hub do. This calculator assumes the borrower actually qualifies for and commits to the shorter New Term's higher monthly payment for its full duration — it does not check affordability, does not model a partial-term refinance, and does not account for closing costs or fees that a real switch to a shorter term might carry.