On a €300,000 annuity mortgage at 4% over 30 years you pay about €1,432 per month and €215,609 in total interest. Adding €200 a month of extra repayment shortens the term by roughly 6 years and saves around €50,000 in interest.
How does mortgage repayment work?
Every month, your lender charges interest on the outstanding balance and the rest of your payment reduces the loan. On an annuity mortgage the total payment is fixed, so in year one most of it is interest and only a small slice is principal. In year 25 the proportions have flipped. A linear mortgage does the opposite: a fixed slice of principal plus interest on a shrinking balance. The table above shows the split per year, so you can see when you start to build real equity.
Annuity versus linear: total interest
For the same loan and rate, linear always costs less interest because you repay principal faster. On €300,000 at 4% over 30 years, an annuity totals about €215,600 of interest while a linear loan comes to roughly €180,600. The trade-off is cash flow: the linear mortgage starts about €400 per month higher. For many buyers, the lower first payment of an annuity decides the matter, and it is also the better fit for the mortgage interest deduction pattern. Try both with the type selector.
Do extra repayments make sense?
An extra payment reduces the principal immediately, so every future month’s interest is lower. At 4% that is a guaranteed 4% return on money you pay in, before taxes. But your mortgage interest is deductible at up to 37.56% in 2026, so the after-tax cost of your debt is closer to 2.5%. Compare that with what the same money could earn in savings or investments in the compound interest calculator, and remember box 3 taxes savings, as shown in the box 3 calculator. Most Dutch lenders let you repay 10% of the original loan per year without a penalty, so that is a safe ceiling for extra payments.
Using the schedule for decisions
- Look at the balance after your fixed-rate period, say 10 years. That is the amount you will refinance at the new market rate.
- Check the interest column, which is what you can deduct. When it falls below the forfait of your home, the relief disappears.
- Use the total interest to compare offers with different rates. A 0.25 percentage-point lower rate on €300,000 saves roughly €10,000 over 30 years.
For purchase costs, transfer tax and net payments see the mortgage calculator, and for the tax angle see the interest relief calculator.
How to use this calculator
- Enter the loan amount, interest rate and term.
- Choose annuity or linear repayment.
- Add an optional extra monthly repayment to see the savings.
- Scroll through the yearly table for interest, principal and remaining balance.
Key figures at a glance
| Annuity | Constant gross payment |
|---|---|
| Linear | Constant principal, falling payment |
| Penalty-free extra repayment | Usually 10% per year |
| Deduction cap 2026 | 37.56% |
Frequently asked questions
For an annuity use PMT = P × r ÷ (1 − (1 + r)^−n) with r the monthly rate and n the number of months. For linear, repay P ÷ n of principal each month plus interest on the remaining balance.
It depends on the rate and timing. On €300,000 at 4%, €200 extra per month saves about €50,000 and shortens the loan by more than 6 years.
Linear costs less interest overall, but the first payments are higher. Annuity is easier on the budget early on.
Yes, but a fixed-rate period usually allows only 10% per year free of penalty. Larger repayments can trigger a penalty (boeterente) if market rates are lower than your rate.
In this tool the payment stays the same and the term shortens. Some lenders let you recalculate to a lower payment instead.