- Bi-weekly payment
- Half of the standard monthly payment, paid every two weeks. Because a year has 52 weeks, that adds up to 26 half-payments, or 13 full monthly payments instead of 12. On an existing mortgage, the extra payment goes to the remaining principal, shortening the years left and reducing the interest still to be paid.
- Current balance
- The principal you still owe on the mortgage today, not the original loan amount. Your latest mortgage statement or online account shows it. This calculator treats it as the starting point for both the monthly and bi-weekly schedules, so the savings reflect only the years that remain, not interest already paid.
- Years remaining
- How many years are left until the mortgage is scheduled to be paid off at the current payment. The calculator uses it with the current balance and rate to size the standard monthly payment, then measures how much sooner the bi-weekly schedule would finish. The difference appears as time saved.
- Interest saved
- The difference between the interest still due on the current monthly schedule and the interest due on the bi-weekly schedule from today forward. It comes from reducing principal sooner. The figure assumes your servicer credits each bi-weekly payment when received and charges no setup or processing fees.
- Time saved
- How much sooner the mortgage is paid off on the bi-weekly schedule compared with the years remaining. The new payoff time is the years remaining minus this amount. The effect is larger the more years are left, because the extra principal has longer to reduce interest on later payments.
- Standard monthly payment
- The principal-and-interest payment that would repay the current balance over the years remaining at the stated rate. It should be close to the principal-and-interest portion of your current bill. It excludes property taxes and insurance held in escrow. The bi-weekly payment shown is half of this amount.
- Amortization
- The schedule by which each payment is split between interest and principal until the balance reaches zero. Early payments are mostly interest; later ones are mostly principal. Extra principal, such as the thirteenth payment a bi-weekly plan produces each year, moves you further down the schedule and reduces interest on every payment after it.
- Loan servicer
- The company that collects your mortgage payments and applies them to the loan, which may not be the lender that made it. Servicers differ in how they handle bi-weekly payments: some credit each half-payment right away, some hold it until a full payment arrives, and some charge program fees. Those practices affect the actual savings.