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Extra payment priority

Should extra cash hit the mortgage or higher-rate consumer debt first?

Your numbers

Higher-leverage extra payment

Mortgage

Interest saved applying extra to the mortgage$124,861
Interest saved applying extra to consumer debt$4,087
Mortgage months saved103
Consumer months saved27

Tip. Educational estimate with the assumptions listed on this page. Not tax, legal, or investment advice.

Assumptions

  • Each path applies the entire extra payment to one balance.
  • Rates stay fixed.
  • Tax deductibility of mortgage interest is ignored, which favors the consumer-debt path if you itemize.

Explore the numbers

Examples

Load a scenario, then change one input at a time.

Example 1

Card vs mortgage

21% card, 6.25% mortgage.

Higher-leverage extra payment

Mortgage

Example 2

Student loan

7% student vs 6.25% mortgage.

Higher-leverage extra payment

Mortgage

Example 3

Cheap car loan

3% auto vs 6.25% mortgage.

Higher-leverage extra payment

Mortgage

What this calculates

Compare lifetime interest saved if the same extra monthly payment goes to the mortgage versus a consumer loan or card.

How to use it

  1. If the card rate is double-digit, it almost always wins.
  2. If consumer debt is already small, check months saved, not just dollars.
  3. After the expensive balance is gone, rerun with investing vs extra mortgage.

Common mistakes

  • Paying 6% mortgage extra while carrying 21% cards.
  • Counting expected market returns as guaranteed.
  • Ignoring the emergency fund before extra principal.

Formula

Amortize each balance with and without the extra payment. Interest saved = baseline interest − accelerated interest.

FAQ

What if the consumer loan is 0% promo?

Set the consumer rate to 0 and the mortgage will win on interest. Watch the promo end date.

Should I still invest?

After high-rate debt is gone, compare extra mortgage to index investing.

Does this include the snowball method?

This is avalanche math: rate first. Use snowball vs avalanche for multiple cards.

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