Mortgage Overpayment Calculator

Every bank has a calculator that tells you the monthly payment. Far fewer show you the number that actually changes behaviour: what happens if you pay a little more than you have to.

Rates are pre-filled from ECB statistics for 21 euro-area countries, and each one comes with its own rules on repaying early — which is the part most overpayment calculators never mention.

Pre-filled with the ECB average for Germany (June 2026). Replace it with your own offer.

Now try paying it off faster

Your monthly payment

€1,312.70

€143,810 total interest over 25 years

Two ways your lender can apply the same overpayment

This is the choice you get at the counter. Most lenders default to the first.

Shortening the term saves €15,136 more here, because the balance falls faster and stops generating interest sooner. Reducing the payment buys monthly breathing room instead.

Overpaying returns your mortgage rate, guaranteed and untaxed. To beat it, an investment would need to return more than 3.95% a year after tax and fees.

today19.9 yrs25 yrs
as scheduledshortened term

Balance remaining, month by month. The green line reaches zero sooner.

›Year-by-year breakdown
YearBalance as scheduledBalance overpayingInterest saved so far
1€244,015€241,571€44
2€237,789€232,803€186
3€231,313€223,683€431
4€224,577€214,195€782
5€217,569€204,326€1,243
6€210,280€194,060€1,820
7€202,697€183,381€2,516
8€194,809€172,272€3,337
9€186,604€160,717€4,287
10€178,069€148,697€5,372
11€169,191€136,193€6,598
12€159,956€123,187€7,969
13€150,349€109,657€9,492
14€140,356€95,583€11,173
15€129,960€80,943€13,017
16€119,147€65,714€15,033
17€107,899€49,873€17,226
18€96,198€33,394€19,604
19€84,027€16,253€22,174
20€71,366€0€24,944
21€58,196cleared€27,526
22€44,496cleared€29,579
23€30,245cleared€31,080
24€15,420cleared€32,008
25€0cleared€32,340

Before you overpay in Germany

German lenders typically allow around 10% of the balance to be repaid penalty-free each year. Repaying more during a fixed-rate period can trigger Vorfälligkeitsentschädigung, which can be substantial — check your contract before a large lump sum.

Why overpaying does so much

A mortgage payment splits into interest and principal. Early on, most of it is interest — on a 25-year loan at 3.95%, the first payment is roughly 63% interest. An overpayment skips that split entirely and goes straight at the principal.

Because the balance is what generates interest, every euro you knock off stops earning the bank money for every remaining month of the term. One extra €200 in year one saves interest 24 more times than the same €200 in year twenty-four.

That is why the totals look disproportionate. On €250,000 at 3.95%, an extra €200 a month — €48,000 paid in over the life of the loan — removes about €32,000 of interest and five years of payments.

Check your country's rules first

This is where generic calculators mislead people. The EU Mortgage Credit Directive guarantees your right to repay early, but leaves compensation to each member state, and the difference is large.

Belgium caps the fee at three months' interest on the amount repaid. France caps it at 3% of the outstanding balance or six months' interest, whichever is lower. Spain's caps are lower still. Germany, by contrast, permits Vorfälligkeitsentschädigung on fixed-rate loans that can be substantial if you go beyond the usual 10%-a-year allowance.

In practice most lenders allow around 10% of the balance per year with no penalty, which is more than enough room for regular monthly overpayments. It is large lump sums during a fixed-rate period that need checking first.

Overpay, or invest?

The honest version: overpaying returns exactly your mortgage rate, guaranteed and untaxed. Investing may return more, with risk, and usually with tax on the gains. At today's euro-area average of 3.48% that is a genuinely competitive risk-free return.

Two things come first either way. Clear expensive consumer debt — a credit card at 18% dwarfs any mortgage decision, as covered in how to pay off debt fast — and keep an emergency fund intact. Money put into a mortgage is very hard to get back out.

About these numbers

Interest rates are ECB statistics for new house-purchase loans, June 2026, and the early repayment rules reflect national implementations of the Mortgage Credit Directive. Both are official.

The calculation is standard annuity amortisation and assumes a fixed rate for the whole term with overpayments shortening the term rather than reducing the payment. It does not model variable-rate changes, fees, insurance, or any early repayment charge. This is arithmetic, not advice — your lender's terms decide what is actually possible.

Frequently asked questions

How much do I save by overpaying my mortgage?

More than most people expect, because every extra euro comes straight off the principal and stops accruing interest for the rest of the term. On a €250,000 mortgage at 3.95% over 25 years, paying €200 extra a month saves about €32,000 in interest and clears the loan five years early. Paying €100 extra saves roughly €18,000.

Is it better to overpay a mortgage or invest the money?

Overpaying gives you a guaranteed, tax-free return equal to your mortgage rate — at 3.95% that is a certain 3.95%. Investing might beat it over long periods but carries risk and, in most countries, tax on gains. The higher your rate, the stronger the case for overpaying; at rates near 2% the argument tilts the other way. Clear expensive consumer debt before either.

Can I be charged for repaying my mortgage early in the EU?

You always have the right to repay early under the EU Mortgage Credit Directive, but member states may let lenders charge fair compensation, capped at their actual financial loss. The rules vary widely: Belgium caps it at three months' interest, France at 3% of the balance or six months' interest, and Spain far lower still, while Germany's Vorfälligkeitsentschädigung on a fixed-rate loan can be significant. Most lenders allow around 10% a year penalty-free.

What is the average mortgage rate in Europe right now?

The euro area average on new house purchase loans is about 3.48% as of June 2026, according to ECB statistics. The spread across countries is wide: Malta is around 1.95% and Spain 2.89%, while Latvia is 4.29% and Germany 3.95%. Your own offer depends on your deposit, term and lender, so treat the national figure as a starting point.

Should I shorten the term or reduce the monthly payment?

If your lender offers the choice when you overpay, shortening the term saves far more interest than reducing the payment, because the balance falls faster. Reducing the payment improves monthly cash flow instead. This calculator models the first approach — the payment stays the same and the loan simply finishes sooner.

Sources

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