Scrib

At Day 1 of our mortgage, I was paying X amount extra towards the principle each month. Now, I want to increase X every month.

I am trying to figure out how much of an impact that is going to have on how much quicker the mortgage would be paid off.

I've looked for calculators online, but they're just not sophisticated enough to help with something like this. So I'll look to Excel.

Anyone have a worksheet already created that does this?

I would assume I'd need to know original balance, interest rate, number of months originally on the mortgage, current balance and number of months into the mortgage... What else???

phil2

pm me what you wanna do and I'll ship over an amoritization schedule in the morning.

Scrib

Isn't there a tool that I can use myself?

ReWritable

You can try Bankrate's mortgage calculator, it handles what-if's like extra payments and gives you a complete schedule incl. pay-off date. It is the best I have seen.

http://www.bankrate.com/brm/mortgage-calculator.asp

good luck.

Scrib

^^^

That calculator assumes you're starting at day one. I need something that takes into account what I've been doing for the last 3.5 years.

phil2

You are not going to find this without paying for software.

Fibonacci

All you need to do is find out your current outstanding principle balance and input that as the new baseline.

This is another similar calculator:

http://www.bloomberg.com/invest/calc...ortpayoff.html

phil2

Yes, but that will not tell him what if any savings he has realized which is probably minimal over 3 years anyways.

Fibonacci

Seems to me like this should be a simple side by side comparison, no?

Spreadsheet 1) Current PI + extra principal payment.

Spreadsheet 2) Current PI + proposed increase.

phil2

I agree.

doopstr

This looks pretty good http://www.joecheng.com/amortization/

Let me explain to you how an extra payment works. Look at this screenshot...


Let's imagine this is your loan and you are currently at month 10.
The principle for month 11 is 107.56. If you include that 107.56 in the month 10 payment you have just effectively reduced your term by one month. When you get your next statement you will see that your principal balance is $148,746.95.

As you will see it is much easy to reduce your term earlier in the mortgage than later.
Want to reduce your term by two months at a time? Just include the next two principal payments. So you would add $215.84 to your month 10 payment.

Understand that you are reducing the term, not skipping months. When you reduce your term you still need to make your next month's payment!

Fibonacci

As a side note, I've never been a fan of the extra principle payment. You can barely trust the finance co's to correctly escrow (which is why I don't), let alone apply extra principle correctly to the ammortization schedule.

If you really want to pay down faster, it makes more sense to simply refi into a shorter duration loan. Just my humble

doopstr

One other tip, make sure you have your house in money/quicken as an asset and tell money/quicken about your mortgage. It can then track this stuff for you.

doopstr

The spreadsheet is very good at helping with this. Input your original loan information into the spreadsheet, then find your current principal balance . That is the effective month that you are at.

ChodTheWacko

Your original question was: "I am trying to figure out how much of an impact that is going to have on how much quicker the mortgage would be paid off."

The past is the past. It's not really relevant to how fast you can pay off your current balance. As of today you have balance X. You can pay it off with additional principle A or B or whatever. So doing calculations with a starting balance of X at day 1 is exactly what you need to do.

If you want to know how much you saved from original date to now, you can do that via the same calculator. Just compute it with the additional principle, look at the amortization calender, and find the line that says, 'Balance X, Interest Y',
and compare the Interest differences.

- Frank