In loan terms, extra payment means paying more money on top of your monthly payment to lower the amount of the total interest paid, as well as shorten the payment period over the life of the loan. You can think of make additional payment after you gain some profit in your investment, your salary is raised, or you won lotteries :-).
This extra payment mortgage calculator will help you calculating the impact of your extra payment to your existing loan or mortgage. You can also plan to make extra payment regularly whether paying it monthly, quarterly, semi-annually or annually. The result will give you a rough calculation about how much your interest can be saved on how long your loan period can be shortened. This calculation is based on general loan assumption, and probably it won’t give you exact numbers, because it could be additional calculation or penalties applied to your extra payments based on your initial loan agreement.
This open office loan template consist of two worksheets. First worksheet is a place where you can put your extra payment plan in term of amount and payment period, and see the result of your loan without and with extra payments. In the second worksheet, there is the extra payment amortization table where you can see the profile of your loan with extra payment every month. You can see also in the table or in the picture above that the extra payment amount goes toward the principal, which lowers the total amount of interest.
