Calculate interest saved and new loan tenure with prepayment. Free online prepayment calculator with formula, examples, and FAQ for early loan payoff.
Making a prepayment (lump sum payment toward your loan principal) can significantly reduce your total interest burden and shorten your loan tenure. The prepayment calculator shows you exactly how much interest you'll save and how many months/years you can cut from your loan by making a one-time prepayment. Even a single prepayment early in the loan can save a substantial amount.
After prepayment: New Balance = Current Balance - Prepayment | New Tenure = calculated from New Balance at same EMI | Interest Saved = Original Total Interest - New Total InterestWhen you prepay, the amount goes directly toward reducing the principal (not future EMIs). With a lower principal, the same EMI now has more going toward principal and less toward interest each month. This accelerates the payoff. The earlier you prepay, the greater the impact because you reduce the principal before it accumulates years of compounding interest.
| Input | Output |
|---|---|
| Loan: $200,000, Rate: 8%, 20 years, Prepay: $50,000 after 24 months | Months Saved: ~62 (5.2 years), Interest Saved: ~$55,000+ |
| Loan: $100,000, Rate: 7%, 15 years, Prepay: $20,000 after 12 months | Months Saved: ~30 (2.5 years), Interest Saved: ~$12,000+ |
| Loan: $300,000, Rate: 9%, 25 years, Prepay: $75,000 after 36 months | Months Saved: ~86 (7.2 years), Interest Saved: ~$140,000+ |