Biweekly Mortgage Payments: Do They Save Money?
Biweekly payments add up to one extra monthly payment a year, cutting a 30-year loan by 4.5 to 6 years. See the math, fees to avoid, and the free DIY version.
7 min read · Updated
Yes, biweekly payments save money, but only because 26 half-payments a year add up to 13 full monthly payments instead of 12; that one extra payment goes to principal. On a typical 30-year loan, that cuts roughly four and a half to six years off the term and saves tens of thousands to over $100,000 in interest, and you can get almost exactly the same result for free by adding one-twelfth of a payment to each monthly bill.
What doesn’t save money is paying a company a fee to do it for you, or splitting your payment in a way your servicer just parks in a suspense account. Here is the math and how to set it up correctly.
At a glance
- Payments per year
- 26 halves = 13 full
- vs 12 on a monthly schedule
- Time saved (30-year loan)
- About 4.5–6.25 years
- Higher rates save more
- Interest saved on $500,000 at 6.5%
- $145,427
- Adding 1/12 of a payment each month
- Free DIY version
- Payment ÷ 12 extra each month
- Or one extra payment a year
Why it works: the 13th payment
A year has 52 weeks, so paying every two weeks means 26 payments. If each is half your monthly payment, you pay the equivalent of 13 monthly payments a year. The 13th goes entirely to principal, and every dollar of principal you retire early stops accruing interest for the rest of the loan. Nothing about the biweekly schedule itself is magic; it is the extra money.
How much it saves on typical loans
| Loan | Monthly P&I | Extra/month | Paid off in | Interest saved |
|---|---|---|---|---|
| $300,000 at 6.0% | $1,798.65 | $149.89 | 24 yrs 7 mo | $73,665 |
| $400,000 at 5.0% | $2,147.29 | $178.94 | 25 yrs 4 mo | $67,867 |
| $500,000 at 6.5% | $3,160.34 | $263.36 | 24 yrs 2 mo | $145,427 |
| $750,000 at 7.0% | $4,989.77 | $415.81 | 23 yrs 9 mo | $256,061 |
The pattern: higher rates and bigger balances mean bigger savings, and the loan shortens by roughly four and a half to six and a quarter years.
Three ways to make the 13th payment ($500,000 at 6.5%)
| Method | Paid off in | Total interest | Saved |
|---|---|---|---|
| Regular monthly payments | 30 yrs | $637,722 | — |
| One extra full payment each December | 24 yrs 4 mo | $497,748 | $139,974 |
| 1/12 extra with each monthly payment | 24 yrs 2 mo | $492,295 | $145,427 |
| True biweekly, each half applied the day it’s paid (best case) | About 24 yrs | $487,024 | $150,699 |
The differences between methods are small. Paying the extra earlier in the year saves a little more, but the big win comes from making the 13th payment at all.
Amortization: how fast the balance falls
| Year | Regular payments | With 1/12 extra each month | Difference |
|---|---|---|---|
| 1 | $494,411 | $491,155 | $3,256 |
| 5 | $468,055 | $449,442 | $18,613 |
| 10 | $423,881 | $379,530 | $44,351 |
| 15 | $362,796 | $282,854 | $79,942 |
| 20 | $278,326 | $149,168 | $129,158 |
| 24 | $188,004 | $6,220 | $181,784 |
| 25 | $161,521 | Paid off | — |
| 30 | Paid off | Paid off | — |
Early on, the gap looks small because most of each payment is interest. It widens every year as the extra principal compounds. See the full month-by-month view in the amortization schedule calculator.
The catch: how servicers handle half payments
So if you simply send half your payment every two weeks without an official biweekly arrangement, the first half may sit uncredited until the second arrives. You get no interest benefit from the timing, and if the second half is late, the payment can be late. The extra 13th payment still helps once it is applied, but you are better off controlling it yourself.
Watch out for paid biweekly programs
Some lenders and third-party companies sell biweekly plans. Before enrolling, ask: Is there an enrollment fee or a per-payment fee? When exactly is each half applied to my loan? Who holds my money in between? Fees eat directly into the savings. For example, a hypothetical $300 setup fee plus $5 per debit (26 a year) would cost $3,420 over 24 years, money that could have gone to principal instead. If your servicer offers a true biweekly option with no fee and applies each payment as received, that is fine; otherwise do it yourself.
The free DIY version
- 1
Find your principal-and-interest payment
It’s on your monthly statement. Leave out escrow for taxes and insurance. - 2
Divide by 12
On a $3,160.34 payment, that is $263.36. - 3
Add it as “additional principal” each month
Use the servicer’s extra-principal field online or on the coupon, or set up a recurring principal-only payment. - 4
Or make one extra payment a year
Send a full extra payment marked as principal, for example from a tax refund or bonus. - 5
Check your statement
Confirm the extra went to principal, not escrow or next month’s payment.
Before you start
- Prepayment penalties. Federal rules limit them to certain fixed-rate qualified mortgages, for no more than three years, and the CFPB says they generally don’t apply to small extra principal payments. Check your note if your loan is new.
- Emergency fund first. Extra principal is hard to get back. Make sure you have savings and no high-interest debt; see pay off your mortgage early or invest?
- Your monthly payment won’t drop. Extra principal shortens the loan. For a lower payment, look at a recast or refinancing.
Model your own loan with the extra mortgage payment calculator.
General information, not financial advice. Figures assume a fixed-rate loan with no missed payments.
Re-verified 2026-10-12. Reg Z 1026.36(c)(1) (CFPB regulation text and official commentary): a periodic payment (principal, interest and escrow) must be credited as of the date of receipt; a partial payment may be credited, returned, or held in a suspense/unapplied funds account and treated as a periodic payment once enough accumulates. Reg Z 1026.43(g) prepayment-penalty limits and the CFPB note that small extra principal payments do not normally trigger penalties. All loan figures recomputed by the fact-checker with monthly compounding: P&I $1,798.65/$2,147.29/$3,160.34/$4,989.77; with 1/12 extra, payoff 24y7m/25y4m/24y2m/23y9m and savings $73,665/$67,867/$145,427/$256,061 (within $2 rounding); one extra December payment 24y4m, $139,974 saved; true biweekly with daily interest on a 365-day year about 23.97 years, $487,024 interest; year-end balances match. Fee example ($300 + $5 x 26 x 24 = $3,420) is hypothetical arithmetic. Fixed: intro time-saved range now matches the table; eCFR links (bot-blocked) replaced with CFPB regulation pages.
Sources
- 12 CFR § 1026.36(c), Servicing practices: payment crediting and partial payments (Regulation Z) · Consumer Financial Protection Bureau (accessed October 12, 2026)
- 12 CFR § 1026.43(g), Prepayment penalties (Regulation Z) · Consumer Financial Protection Bureau (accessed October 12, 2026)
- What is a prepayment penalty? · Consumer Financial Protection Bureau (accessed October 12, 2026)
General information, not legal, tax or financial advice. Rules change; confirm with the agency or a professional before you act.