Far too often, people look at their monthly payments on a mortgage and just assume that’s the best amount to pay each month. However, you have the potential to save a lot of money if you take a closer look at the payment options available to you and analyze what the best option truly is. A loan payment calculator is a valuable tool for helping you make decisions because you’ll get to see exactly how much you’ll save on each payment plan option.

Tools a Loan Payment Calculator Offers

The most basic calculators just take information about your loan, like the amount borrowed, interest rate, and number of months in the repayment term, and tell you what your monthly payments on a mortgage will be. However, a more sophisticated loan payment calculator will tell you a lot more. For example, it will list the amount of interest and principal included in each payment and the total interest you’ll pay over the course of the repayment term. Calculators also often allow you to see how extra one-time, monthly, or annual payments will affect the total interest you pay. A biweekly mortgage calculator also allows you to see the impact of making half payments every two weeks rather than full payments every month, which adds up to big savings.

Key Ways to Save on Your Mortgage

The main way to save money on your mortgage is to pay more than the required monthly payments on a mortgage each month. Doing this, you’ll pay off more of your principal balance and reduce what you owe. Because the interest each month is based on what you owe, you’ll start a snowball effect of reducing the interest payments and increasing the principal payments in the future. Even one extra payment will have this effect, but multiple extra payments are even better. These extra payments can be a little bit each month, a lump sum each year, a one-time payment, or a couple of extra payments each year when you’re on a biweekly mortgage schedule.

Tips for Using a Biweekly Mortgage Calculator

Analyze the effects of many different payment scenarios with the calculator. Start with the basic biweekly payment plan to see how much that will save you, but don’t stop there. Enter the amount of money you could add to each biweekly payment to save even more. Because you’re making the payments less frequently, it may be easier for you to budget for the extra payments. Don’t forget to revisit the biweekly mortgage calculator anytime you have a change in your financial situation to see how you could add still more to your savings.