Our spreadsheet DOES round, and it also adjusts the last payment to bring the balance to zero. Keep in mind that some online calculators do not round the payment and interest to the nearest cent, so if you see a small discrepancy in the calculations, this is likely the issue. We used a number of different online calculators to verify this spreadsheet. The normal weekly payment would be $134.00, so the extra payment would be 145.40-134.00= 11.40.Īnother way to estimate the effect of making one extra monthly payment each year is to choose the Monthly option in the Payment Frequency and set the Extra Payment equal to payment/12. A normal bi-weekly payment, found by setting the Payment Frequency to bi-weekly, would be $268.14 rounded.Īccelerated Weekly plans are similar, but each weekly payment would be 1/4 of 581.60 or $145.40. There are 26 bi-weekly payments in a year so the difference between 581.60*12 and 581.60/2*26 is 581.60, or one extra monthly payment per year. In an Accelerated Bi-weekly plan, each bi-weekly payment would be 1/2 of 581.60 or $290.80. The total payments for the year would be 7560.80. The result is that by the end of a year you will have paid the equivalent of one extra monthly payment towards the principal.Įxample: A 100,000 mortgage at 5% interest, compounded semi-annually, with an amortization period of 25 years, results in a monthly PI (principal + interest) payment of $581.60 (rounded). By tradition, the "accelerated bi-weekly" payment is defined as 1/2 a normal monthly payment. The first thing to realize is that "accelerated" means that rather than a normal bi-weekly payment, you are also making an extra payment on the principal. This calculator allows you to analyze the effect of an Accelerated Bi-Weekly payment plan, a common type of mortgage repayment plan.
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