I don't have a mortgage so I don't personally do this, but I can tell you it's a popular practice. > but it doesn't change the calculus fundamentally. It does

I don't have a mortgage so I don't personally do this, but I can tell you it's a popular practice. > but it doesn't change the calculus fundamentally. It does change the calculation that this tool is showing. If you use the tool and assume you make 3% interest on savings, but then make periodic payments on your 6% interest loan, there is no way to model that with this tool. OK, so lets say this is a bad idea and you should instead not have any savings in that case, and make all of your savings into payments on your mortgage interest. You're saying we could model that by assuming you are making periodic risk-free 5% (or whatever) investment instead. > Actually the longer the mortgage term the bigger total tax deduction you get, so in that sense the more you pre-pay the costlier it is. I get what you're saying but a tax deduction can never completely offset the interest payment right? Also, it depends on the difference between capital gains tax and the credit you would get on your tax rate for the interest.