Early Mortgage Repayment Calculator
Calculate how much interest you save by repaying your mortgage early, and choose between reducing the monthly payment or shortening the term.
Parameters last reviewed on 06/09/2026 · Sources: BOE — Ley 5/2019
Early mortgage repayment consists of returning part of the outstanding capital to the bank before the term stipulated in the contract. This reduces the outstanding debt and therefore future interest. The two main options are: reducing the monthly payment (keeping the original term) or shortening the total mortgage term (keeping the same payment). Shortening the term usually saves more in total interest, while reducing the payment gives more monthly liquidity; the right option depends on your situation.
This calculator shows you in detail how much you would save in each scenario, including the early repayment fee applicable under Spanish Law 5/2019 for fixed and variable mortgages. Enter the outstanding balance, interest rate and months remaining, and you will get a clear comparison between continuing with the original plan or making an early repayment.
Current payment
869,94 €
New term
18a 2m
Interest saved
9123,67 €
Estimated fee
15,00 €
Calculations are indicative. The exact fee may vary depending on the specific terms of your mortgage contract.
Reducing the payment or the term: how it works
When you repay early you hand over capital that is deducted directly from the outstanding debt, and from there you can choose between two effects. If you reduce the payment, the term stays the same and the monthly amount falls, easing your monthly budget but you keep paying interest for the same number of years. If you reduce the term, the payment stays the same and what shortens is the number of remaining instalments, so you stop paying interest in the loan's final years. Since interest is calculated on the outstanding capital over time, eliminating whole years of debt saves considerably more than slightly lowering each monthly payment.
Worked example
Start from a €150,000 mortgage at 3% over 25 years, with a monthly payment of about €711 and a total interest cost of roughly €63,400. If you repay €10,000 at the start and choose to reduce the payment, the monthly amount falls to about €664 and total interest savings come to around €4,200. If instead you choose to reduce the term, you keep the €711 payment but finish 29 months earlier, and interest savings rise to about €10,600. With the same contribution, reducing the term saves more than twice as much here.
Effect of repaying €10,000 (€150,000 mortgage at 3% over 25 years)
| Option | Interest saved |
|---|---|
| Reduce payment | ≈ 4.200 € |
| Reduce term | ≈ 10.600 € |
How to interpret the result
Reducing the term saves more interest almost always, but reducing the payment gives more room in your monthly budget, which is valuable if your income is variable or you anticipate significant short-term expenses. A common middle strategy is to reduce the term while your finances are comfortable and switch to reducing the payment if difficulties arise. Bear in mind two practical factors as well: repaying early is more profitable the sooner you do it, because in the first years most of the payment is interest, and it is unwise to drain your emergency fund to repay, since getting that money back later would mean taking out a new loan, almost certainly more expensive than the mortgage.
Payment or term: deciding with numbers, not intuition
Cutting the term almost always saves more interest, because interest is charged on the outstanding capital and every month you remove is a month that stops generating it. Cutting the payment saves less, but frees up money every month, and that has a value the table does not show: room for the unexpected, capacity to save, or simply sleeping better. A sensible way to decide is to look at your situation, not only at the total saved. If your job is stable and the payment does not squeeze you, cutting the term is the most efficient option. If money is tight each month, your income is variable or you expect a large expense, cutting the payment buys peace of mind. And there is a third route that works very well: cut the payment and keep paying the old amount voluntarily through regular partial repayments, which gives you the saving of a shorter term while keeping the option to lower the payment when needed.
When to repay early and when not to
Early repayment is worth more the sooner you do it, because in the first years of a French-amortisation mortgage most of the payment is interest and the capital falls slowly; the same money paid at the start eliminates far more future interest than paid at the end. That said, it is not always the best decision. Before repaying early it is wise to have an emergency fund, because the money you hand the bank cannot be recovered: what you reduce is debt, not available liquidity. If your interest rate is low and you could obtain a reasonably safe return above it, the comparison stops being obvious, although early repayment has an advantage investments do not: the saving is certain and tax-free. And if you bought your main home before 2013 and keep the state deduction, repaying up to the deductible limit each year usually pays off through the refund it generates.