Portugal Mortgage Prepayment Calculator
Enter what's left on your mortgage and how much you want to prepay, and see how much you save in interest -- and how many months sooner you finish, or how much the instalment drops.
A generic prepayment calculator, not advice on whether you should prepay or not.
How we calculated this
Constant-instalment system (Portugal's standard method): the monthly instalment covers principal and interest for the remaining term, at the monthly rate (TAN ÷ 12). When you prepay, we reduce the outstanding balance and recalculate -- reducing the term keeps the instalment the same and shortens the months; reducing the instalment keeps the term and lowers the monthly amount. The fee is the chosen percentage of the amount prepaid.
Reducing the term vs. reducing the instalment
Prepaying an amount toward your outstanding balance always gives you two options. Reducing the term keeps the monthly instalment exactly the same, but shortens the number of months until the mortgage ends -- since you're paying the same amount for less time, the total interest paid is always lower with this option. Reducing the instalment keeps the original term, but lowers what you pay every month from now on -- you save less interest overall, but the relief in your monthly budget is immediate. There's no universally right choice: it depends on whether what you need most is having the mortgage paid off sooner, or more breathing room in next month's budget already.
The prepayment fee
Since 1 January 2026, the temporary fee exemption for variable-rate mortgages on primary residences (created in 2022) is no longer in force, so the legal maximum caps apply again by default: 0.5% of the amount prepaid on variable-rate mortgages, 2% on fixed-rate ones. These are the maximums a bank can charge -- your contract may set a lower figure, or even an exemption, so it's always worth confirming the exact amount before deciding.
When prepaying is worth it
Prepaying only pays off when your mortgage rate, net of the fee, is higher than what that same money would earn if you left it invested or in savings. With relatively low mortgage rates, the calculation isn't always obvious -- which is why this calculator only shows you the prepayment numbers themselves, without comparing against any specific investment product. It's also worth having your emergency fund already built before prepaying -- money you've prepaid is no longer available if you suddenly need it.
What this calculator doesn't do
It assumes the constant-instalment system, the most common in Portugal, but doesn't model mixed rates that switch regime partway through the term, nor insurance tied to the loan. It doesn't replace your bank's official simulation, which has access to your contract's actual amortisation schedule.
Frequently asked questions
Reduce the term or reduce the instalment, which saves more?
Reducing the term always saves more interest in total, for the same amount prepaid -- you keep the instalment the same, but pay off the loan faster, so there are fewer months accruing interest. Reducing the instalment saves less interest overall, but eases your monthly budget right away. The choice depends on what you need more: fewer years of mortgage, or more breathing room every month.
Is early repayment always worth it?
It depends on comparing your mortgage rate against what that same money would earn elsewhere, after the prepayment fee. If you don't have an emergency fund yet, it usually makes more sense to build that first -- prepaying a mortgage doesn't give you the money back if you suddenly need it. This isn't a recommendation, it's a comparison of numbers.
Does the fee always apply?
The legal maximum fee is 0.5% of the amount prepaid on variable-rate mortgages and 2% on fixed-rate ones, but that's exactly it -- a maximum. Your contract may have a lower fee or an exemption, for example if you're a long-standing customer or have a specific bank product. Always confirm the exact figure with your bank before deciding.
Related tools
You know how much you'll save. Now it just needs setting aside.
Otterbond helps you create a Prepayment fund and track progress until you have the full amount saved up.
Try it freeEstimate based on 2026 public rules, not financial, legal or tax advice.