Understand your results
Equal total payment (amortizing) loans use a constant monthly principal-and-interest payment. Equal principal loans repay the same regular principal each month plus declining interest. Select the method that matches your actual agreement.
Extra principal is applied after the scheduled monthly payment. Shorten-term mode maintains the original regular payment or principal. Reduce-payments mode recalculates the required payment after every extra payment over the original remaining term. This is a hypothetical comparison: actual recast eligibility, timing, minimums and fees depend on your lender.
Monthly rate r = annual interest rate / 12. The equal payment is P × r / (1 − (1 + r)^−n); at 0% it is P / n. Equal regular principal is P / n. Computations use unrounded values, so displayed rounded rows can differ slightly from totals.
Fees apply to actual extra principal after a fee-free annual allowance, renewed every 12 modeled payments. Flat fees use the entered percentage during the fee window. Declining fees additionally multiply by (fee-window months − payment number + 1) / fee-window months, a monthly approximation rather than daily contract calculations. A fixed additional fee is charged once at the first extra payment. No penalty is assumed by default. Taxes, insurance and contractual differences are excluded.
Net savings = original interest − interest with extra payments − extra-payment fees, comparing the same repayment method. A negative result means estimated fees exceed the interest saved. Also consider emergency savings, higher-rate debt and cash flow.
Further reading
CFPB: Mortgage amortization
CFPB: Prepayment penalties (US)
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