Tools 5 min read

Loan Calculator

Understanding your loan terms is essential to making smart borrowing decisions and paying off debt efficiently.

How Loan Amortization Works

Where your monthly payment actually goes.

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Each monthly payment is split between interest and principal. Early payments are mostly interest; later payments are mostly principal. On a €200,000 mortgage at 3.5% over 30 years: Month 1 payment of €898 = €583 interest + €315 principal. Month 360: €898 = €3 interest + €895 principal. This is why extra payments early have the biggest impact.

Extra Payments: The Fastest Way Out of Debt

How small extra payments save thousands.

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On a €200,000 mortgage at 3.5% for 30 years: Adding €100/month extra saves €28,000 in interest and pays off 4 years early. Adding €200/month saves €47,000 and pays off 7 years early. Apply extra payments to highest-interest debt first (avalanche method). Even rounding up payments helps.

Fixed vs Variable Rate Loans

Which is right for you?

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Fixed rate: Payment stays the same for entire term. Predictable, easier to budget. Better when rates are low or rising. Variable rate: Payment changes with market rates. Usually starts lower than fixed. Better when rates are high and expected to fall. In the current EU environment, consider: Fixed for mortgages over 10 years, variable for short-term loans you plan to pay off quickly.