A mortgage monthly payment depends on the amount borrowed, the term, the interest rate and the insurance. Enter these to find your monthly payment and the total cost of your loan for a new-build purchase.
- Of which payment excl. insurance—
- Total interest cost—
- Total insurance cost—
- Total cost of the loan—
Indicative fixed-rate estimate, insurance calculated on the initial capital. The real cost depends on the loan offer and insurance contract chosen.
How is a monthly payment calculated?
The monthly payment relies on the amortisation formula: it combines the capital borrowed, the monthly interest rate and the number of payments. Each instalment repays part interest and part capital, with the proportion shifting over the life of the loan. To this payment is added borrower insurance, calculated on the capital.
Worked example
For a loan of 250,000 € over 20 years at 3.5%, with insurance at 0.34%, the monthly payment is around 1,521 € (including 71 € of insurance). Over the full term, the loan costs nearly 115,000 €: about 98,000 € of interest and 17,000 € of insurance. Switching to 15 years raises the payment to around 1,858 €, but the total cost falls below 85,000 €.
What is the impact of term and rate?
Extending the term lowers the monthly payment but increases the total interest cost. Conversely, a shorter loan costs less overall but requires higher income. The rate weighs directly on the cost: a few tenths of a point mean thousands of euros over 20 years. Check your borrowing capacity first.
How to lower your monthly payment?
Several levers reduce the monthly payment: increase the deposit, extend the term, negotiate the rate or delegate borrower insurance. Also consider the zero-rate loan, which finances part of the purchase interest-free. To prepare your project, read our guides on financing a new home and the benefits of buying new-build.
Frequently asked questions
How do you calculate a mortgage monthly payment?
The monthly payment depends on the amount borrowed, the interest rate and the term. It is calculated with the amortisation formula: payment = capital × monthly rate / (1 − (1 + monthly rate)^−number of months). The calculator adds borrower insurance to obtain the real monthly payment.
Which loan term should you choose for new-build?
For new-build, terms of 20 to 25 years are common. A longer term lowers the monthly payment but increases the total interest cost. A shorter term costs less overall but requires a higher monthly payment, and therefore higher income.
Is borrower insurance mandatory?
Borrower insurance is not legally mandatory but banks systematically require it to grant a mortgage. Its rate, applied to the capital, represents a significant share of the total cost: it can be delegated to an external insurer to reduce the bill.