PAYMENT BASICS

How to make a principal-only mortgage payment

A regular mortgage payment normally covers scheduled principal and interest. An extra payment only reduces future interest if the loan servicer applies it to the unpaid principal rather than treating it as an early future installment.

Use the servicer’s process

Many servicers offer a separate principal-payment option online. Others require a note, a specific payment coupon, or a phone instruction. Do not assume an overpayment will automatically be categorized the way you expect.

Verify after posting

Review the next statement. The principal balance should fall by the extra amount, subject to interest that accrued before the payment date. Keep confirmation records for any large payment.