Equal or decreasing installments: which is better?

When taking a mortgage you choose how the installments are structured.

Equal installments (annuity)

• The same amount every month (as long as the rate doesn't change).
• At the beginning you pay mostly interest, later mostly principal.
• Lower first installment → higher creditworthiness.

Decreasing installments

• You repay the same part of principal every month plus interest on the remaining balance.
• The first installments are higher, then they decrease.
• Lower total interest – often by tens of thousands of złoty on a large loan.

Which to choose?

• Tight budget or creditworthiness at the limit? Equal installments.
• Stable, higher income and you want to pay less in total? Decreasing installments.
• Alternative: equal installments plus regular overpayments – flexibility with a similar saving.

Can I change later?

Many banks allow switching – usually by signing an annex. Ask before signing the agreement.

Switch between both types in the loan step of the calculator and compare the first installment and the total interest.