Understanding Your Repayment Strategy Illustrations:

• Estimates Only: These calculations are illustrative and based on your inputs. Actual outcomes depend on your lender's policies for applying payments and potential fees.
• Biweekly Payments: This strategy assumes paying half your standard monthly payment every two weeks. This results in 26 half-payments (or 13 full standard monthly payments) per year, with the "13th payment" effectively reducing principal over the course of the year.
• One Extra Annual Payment: This strategy assumes one additional payment equal to your standard monthly payment is made each year, applied directly to principal.
• Extra Monthly Payments: Assumes the extra amount you specified is added to your standard monthly payment each month and applied to principal.
• Principal Application is Key: For any accelerated payment strategy to effectively save interest and shorten your loan term, it is crucial that all extra funds are applied directly to the loan principal, not towards future interest or held by the lender for future standard payments. Always communicate your intent clearly to your lender.
• Lender Policies & Fees: Before adopting any accelerated payment plan:
  • Verify with your lender if they accept specific payment frequencies (like biweekly) or how they process extra payments.
  • Confirm how additional principal payments are applied.
  • Inquire about any fees associated with making extra payments or using accelerated payment plans (some third-party biweekly services may charge fees).
• What's 'Best'? The 'best' repayment strategy depends on your individual financial goals (e.g., minimizing total interest, paying off the loan fastest, maintaining manageable cash flow, psychological motivation). This tool is designed to help you compare the potential outcomes of different approaches, not to make the decision for you.

This tool is for informational purposes only and does not constitute financial advice. Always confirm specific details and policies with your lender.