A biweekly plan on a $400,000 mortgage at 6.75% makes 26 half-payments a year, which equals 13 full payments. That one extra payment cuts about 6 yrs off the loan and saves about $126,184 in interest.
Biweekly vs monthly
| Plan | Payment | Payoff time | Total interest |
|---|---|---|---|
| Monthly payments | $2,594.39 | 30 yrs | $533,981 |
| Half payment every two weeks (26 half-payments = 13 payments a year) | $1,297.20 every 2 weeks | 24 yrs | $407,797 |
The savings come entirely from the extra payment, not from the biweekly schedule itself. You can get the same result by dividing your monthly payment by 12 and adding that amount to each monthly payment ($216.20 a month here).
Watch for fees and servicer rules
- Some servicers charge to set up a biweekly plan or hold half-payments until a full payment is collected, which removes the benefit.
- Third-party biweekly programs can charge fees. Doing it yourself with an extra monthly amount costs nothing.
What we assumed
- The biweekly plan is modeled as one extra monthly payment spread over 12 months.
Related calculators: Mortgage Calculator, Personal Loan Calculator.
Questions people ask
Is biweekly better than adding extra each month?
They produce nearly the same result when the extra amount is the same. Choose whichever is easier to keep up.
Estimates for general education, not financial, tax or legal advice. Real results depend on your lender, employer, tax situation and location. See the disclaimer.