Early mortgage repayment: fees, legal limits and how to do it
Updated: July 12, 2026
Early repayment means paying back part (or all) of your mortgage principal ahead of schedule. It is one of the most profitable financial decisions the average mortgage holder can make: every euro repaid early stops generating interest for all the years that still lay ahead.
What the law says: capped fees
Since Ley 5/2019 de Contratos de Crédito Inmobiliario (LCCI, Spain’s mortgage credit law), the early repayment fee is capped by law and can only be charged if the bank proves that your repayment causes it a financial loss:
| Type of mortgage | Maximum fee |
|---|---|
| Variable (option A) | 0.25% of the principal repaid, only during the first 3 years |
| Variable (option B) | 0.15% of the principal repaid, only during the first 5 years |
| Variable, after that period | 0% |
| Fixed, during the first 10 years | 2% of the principal repaid |
| Fixed, from year 11 onwards | 1.5% |
In practice, at current rates many early repayments cause the bank no financial loss, and the effective fee is zero. Check your mortgage deed: mortgages signed before June 2019 are governed by whatever was agreed in it.
How to do it, step by step
- Notify your bank (online banking, phone or branch) that you want to make a partial early repayment and for what amount.
- Choose what to reduce: the monthly payment or the term. It is the key decision and we analyze it in depth in reduce the payment or the term?.
- Sign the order. The bank recalculates the amortization schedule and gives you a receipt showing the new outstanding principal.
You do not need a notary for partial repayments; only full early cancellation with the release of the mortgage charge requires a deed and registration.
When it pays off (and when it doesn’t)
- It pays off most at the beginning. With the French amortization system, during the first years of the mortgage you mostly pay interest: that is when every euro repaid early saves the most. You can check it by simulating two scenarios in the calculator below.
- It pays off more the higher your interest rate. Repaying a mortgage at 4% is like “investing” with a guaranteed 4% return; at 1.5%, your money might earn more elsewhere.
- Don’t drain your savings. Always keep an emergency fund (3-6 months of expenses) before handing money to the bank ahead of schedule.
- Mind the old tax rules: if you bought before 2013 and apply the main-residence deduction, repaying up to €9,040 per year also gets you 15% back on your income tax return.
Early repayment and mortgage type
In a variable-rate mortgage, repaying early reduces your exposure to the Euribor: less outstanding principal means each rise in the index hurts less (you can measure it on our Euribor page). In a fixed-rate mortgage, the saving is exact and predictable from day one. And if your strategy is to repay heavily during the first few years, a mixed mortgage may suit you particularly well.