What Is a Mortgage Payment?
A mortgage payment is the monthly sum you repay to the bank. It consists of two parts: the principal component (paying back the borrowed amount) and the interest component (the bank's fee for lending). Understanding this structure is key to managing your household budget effectively.
The Fixed-Payment (Annuity) Formula
The most popular repayment type in Poland is the equal (annuity) instalment. The mathematical formula is:
P = L × [r(1+r)^n] / [(1+r)^n - 1]
Where:
- P — monthly payment
- L — loan principal
- r — monthly interest rate (annual rate / 12)
- n — total number of payments (years × 12)
Calculation Example
Suppose you take a loan of 400,000 PLN for 25 years at a nominal rate of 7.5% per annum. The monthly rate is 7.5% / 12 = 0.625%, so r = 0.00625. Total payments: 25 × 12 = 300.
Plugging into the formula:
P = 400,000 × [0.00625 × (1.00625)^300] / [(1.00625)^300 - 1] P ≈ 2,962 PLN
Your monthly payment would be approximately 2,962 PLN. Over 25 years, the total repaid is about 888,600 PLN — meaning you pay over 488,600 PLN in interest.
Decreasing vs. Equal Instalments
Polish banks offer two repayment variants:
- Equal (annuity) instalments — you pay the same amount every month. Convenient for budgeting, but you pay more interest overall.
- Decreasing (capital) instalments — the principal portion is fixed; the interest portion falls each month. The first payment is higher, but the total loan cost is lower.
For a 400,000 PLN loan over 25 years, decreasing instalments can save you 40,000–60,000 PLN compared to equal instalments.
Factors Affecting Your Payment
Four key factors determine your monthly mortgage payment:
- Loan amount — the more you borrow, the higher the payment.
- Loan term — a longer term means a lower payment but higher total cost.
- Nominal interest rate — combines the WIBOR (or WIRON since 2024) benchmark with the bank's margin.
- Down payment — a higher down payment (minimum 20%) reduces the loan and often improves the margin.
WIBOR vs. WIRON and Mortgage Rates in 2026
Since 2024, Polish banks have been gradually transitioning from WIBOR to WIRON. WIRON is based on actual overnight (O/N) transactions and is typically 0.3–0.5 percentage points lower than 3M WIBOR. If you took out a loan before 2024, check your agreement for when the conversion occurs and how it will affect your payment.
Calculate Your Payment Online
Instead of applying the formula manually, use the mortgage payment calculator on Liczbnik.pl. Simply enter the loan amount, term, and interest rate — the calculator will show your monthly payment, full amortisation schedule, and total loan cost.
Summary
Calculating a mortgage payment is straightforward once you know the formula. Remember that a variable interest rate means your payment can change alongside NBP policy rates. Always analyse not just the monthly payment but also the total loan cost (APR) before signing a mortgage agreement.