Paying Off Your Mortgage Early

Early Payoff
by Scott Bilker

Scott Bilker is the author of the best-selling book "Credit Card and Debt Management." He is also the Editor and publisher of the FREE DebtSmart® E-mail Newsletter (http://www.debtsmart.com). Sign up today!

Scott,
I would like to pay off my 80K-15 year, 7.74% mortgage in 8-10 years? How much per month or year do I have to make to reach this goal?
--John

John,

Thanks for writing--your question is a great Household Math™ problem! In fact, you just inspired me to add a section so people can submit their Household Math™ questions.

Your question is very straightforward. You have an $80,000 mortgage for 15 years at 7.74%. Assuming these numbers are exactly correct, and no payment have been made to-date, the monthly payment is $752.57.

To pay off $80,000 at 7.74% in 8 years requires a monthly payment of $1,120.40. This saves you $27,904.20 over the 15-year loan.

To pay off $80,000 at 7.74% in 10 years requires a monthly payment of $959.67. This saves you $20,302.20 over the 15-year loan.

Therefore, any monthly payment greater than $960 will achieve your goal of paying of the loan in 8 to 10 years.

Regards, Scott

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