Absolutely (for a true simple interest loan). Part of the reason I mentioned no pre-payment above. I've never thought about it but what percentage of mortgages do you write (I assume you're in the business) do NOT allow pre-payments to apply to the principle and affect the interest calculation? I could be mistaken, but I think the only one I had was my first, since I distinctly remember having to make sure they at least allowed the one (and it was only one) time re-amortization I knew I was going to need. I needed it since I knew in short order I was going to pay it down to reach my 20% equity and get my PMI relieved.
GeauxLSU
I revised me response above, as you were correct. I had misread and my thumbs started taking over. After re-reading, we are saying the same thing, just differently. Yes, I am in the biz. I posted some screenshots to illustrate the example of paying $100 additional principal each month.
Prepayment Penalties are no longer allowed on QM (Qualified Mortgages). QM loans are your basic conventional/government fixed loans, etc.