Michigan Extra Payment Calculator

For a typical $192,000 mortgage (80% of Michigan's $240,000 median home price) at 6.5%, adding $200/month can save you approximately $88,659 in interest and pay off your mortgage 9 years and 5 months early. Your normal total interest would be $244,885, but with extra payments it drops to $156,227. Use the calculator above to see your exact savings.

Both strategies save money, but a lump sum applied early in your loan has the most impact per dollar because it reduces the principal that accrues interest for years. Monthly extra payments offer more consistent savings and are easier to budget for. On a $192,000 Michigan mortgage at 6.5%, a one-time $5,000 payment in year one saves about $10,500 in interest, while $200/month saves $88,659 over the life of the loan. Many Michigan homeowners combine both strategies for maximum benefit.

Michigan law restricts prepayment penalties on certain residential mortgages; most conventional loans originated in the state do not include them.

This depends on your mortgage interest rate versus expected investment returns. At 6.5%, extra payments offer a guaranteed "return" equal to your interest rate — that's $88,659 in guaranteed savings on a $192,000 Michigan mortgage. Tax consideration: Michigan has a flat 4.25% state income tax, and mortgage interest is deductible on the state return, providing a small additional tax benefit for homeowners. If your rate is below 4%, investing in diversified funds may earn more over time. Consider your risk tolerance, tax situation, and financial goals.