How the extra payment calculator works
Why extra payments are so potent early
Amortization front-loads interest: in year one of a 30-year loan at 6.5%, over 75% of each payment is interest. Extra dollars in the early years retire principal that would otherwise compound for decades — the same $200 does roughly triple the work in year 2 as in year 22.
The guaranteed-return frame
Paying down a 6.5% mortgage is a risk-free, tax-free 6.5% return. Comparing honestly: to beat it in a taxable account you would need ~8.5%+ pre-tax at a 25% marginal rate. Extra payments are not the only good use of money — retirement matches and high-interest debt come first — but they are a better default than most spending.
Execute it correctly
Extra amounts must be marked "apply to principal," or servicers may book them as early payments (which changes nothing). Biweekly plans achieve the same effect as one extra payment a year, but a self-directed extra monthly amount is more flexible when a month gets tight.