These calculators are useful when deciding between several mortgage loan options. They enable us to calculate:
- The amount of the mortgage. This is what the bank will lend us, based on our income and the price of the property.
- The instalments we will have to pay each month, and the changes resulting from variations in the reference index (usually the Euribor), and the amortisation of the loan. While we are paying off our mortgage, we can work out which is most advantageous for us - reducing the instalment or the term - depending on the interest we would save in each case.
- The costs of the mortgage.
- The total interest we will pay at the end of the mortgage.
Mortgage simulators also help us calculate the costs resulting from the mortgage itself (appraisal) and buying our home (notary, registry and agency fees, taxes, etc.). In summary, this is an essential tool for choosing the most suitable mortgage for our needs.
How do simulators work?
Mortgage simulators work by combining our personal information with various variables, such as the size of the mortgage, the term, the payment instalments and the interest rate. The simulator combines this information to provide us with the loan conditions. For example, we can calculate the size of the instalments if we enter the price of the house, the interest rate and the term we want.
How many mortgage simulators are there?
There are several, with some being more sophisticated than others. However, they generally use the variables mentioned above. Some of the more advanced ones show the total interest and an amortisation table for the mortgage, with the monthly instalments, principal, interest and the outstanding principal. Some of these calculators work with all the mortgages available in the market. However, the information will always be more accurate if we find out about the mortgage using the simulator of the bank offering it. There are also more sophisticated calculators that provide information on how the mortgage would change in the event of partial repayments.