Mortgage in euros or in lei? What the lower rate really costs

The bank shows you two offers for the same flat: lei at 6.5%, or euros at 4.5%. The euro one is 501 lei a month cheaper from day one, and you start wondering why anyone takes the other.

In short: borrow in the currency you're paid in. If your salary is in lei, the euro offer's lower rate is paid for with exchange-rate risk: its instalment is fixed in euros, so every time the leu weakens, it costs more lei. In the example below the euro loan stays cheaper only while the euro rate rises by less than 1.43% a year on average for 30 years. Over the past 20 years it rose by 2.11% a year [1]. If your salary is in euros, it's the other way round: the euro loan is the one without currency risk.

Why the cheaper instalment isn't cheaper

A euro loan's instalment is fixed in euros. You pay it from a salary in lei, so what it costs you each month is the euro instalment × that month's exchange rate. The interest rate is lower because the bank isn't carrying the currency risk. You are.

That risk is not theoretical. On 7 August 2008 a Swiss franc cost 2.13 lei; on 16 January 2015 it cost 4.45 lei [2]. Anyone repaying a franc loan from a lei salary saw the instalment more than double, with nothing changed at work. Hungary went through the same: a franc cost 140.78 forints on 18 July 2008 and 257.34 on 7 November 2014 [2], when Hungary was converting those loans into forints by law.

The euro moves far less than the franc did, but it still moves. On 27 October 2006 a euro cost 3.5205 lei; on 26 October 2026, 5.3473 lei [1]. That's 51.9% more in 20 years.

The example: 400,000 lei over 30 years

Two made-up but realistic offers for the same flat, both for 400,000 lei over 30 years. The lei loan is at 6.5%; the euro loan is for the same amount in euros (€74,804.11 at 5.3473 lei, the ECB rate on 26 October 2026 [1]) at 4.5%. Instalments are calculated with the annuity formula that the site's loan calculators use.

• Lei loan: 2,528.27 lei a month.
• Euro loan: €379.02 a month, which is 2,026.74 lei at today's rate.

The euro loan is 501.53 lei a month cheaper today, 19.8% less. But the lei instalment stays 2,528.27, while the euro one follows the rate:

A one-off jump of a quarter is a lot. Over 30 years, though, the rate doesn't have to jump; a slow climb adds up too.

• If the rate never moves, the euro loan costs 729,627 lei in total and the lei loan 910,178 lei.
• The two cost the same in total if the euro rate rises by 1.43% a year on average.
• At the past 20 years' pace of 2.11% a year, the euro loan costs 1,015,587 lei: 105,409 lei more than the lei loan, and the last instalments are around 3,794 lei a month.

So the 2-point gap in the interest rate is roughly what the leu has lost against the euro per year. The cheaper rate is a bet that the next 30 years will be kinder than the last 20.

Hungary: the same maths, stricter limits

With forints the picture is the same. In the Hungarian version of this post, a 30 million forint loan over 20 years at 6.5% vs 4.5% in euros saves 33,877 Ft a month today. The euro rate has to rise by 17.85% at once, to 433.04 Ft, for that saving to go. On 13 October 2022 the ECB rate reached 430.65 [3].

Hungary also caps how much of your net income an instalment can take, and the cap is much lower for euro loans. With under 800,000 Ft of net income, a mortgage with the rate fixed for at least 10 years can take up to 50% of it in forints, but a euro loan only 25% with the rate fixed for at least 5 years, and 15% with a variable rate. A euro mortgage can also be at most 50% of the property's value, against 80% in forints [4]. Romania has the same idea: all your monthly debt payments can take up to 40% of net income for lei loans, but 20% for foreign-currency loans [5]. In the example above, the euro instalment needs at least 10,133.70 lei of net income at 20%; the lei instalment needs 6,320.68 lei at 40%. The cheaper loan is the one that's harder to get.

What this leaves out

• The euro rate can move too. A variable euro rate follows Euribor, which went from −0.54% in December 2021 to 4.11% in October 2023 (monthly averages) and was 2.92% in September 2026 [6]. If the example's 4.5% rose by two points to 6.5%, the euro instalment would be €472.81, as much as the lei loan costs at today's rate. Compare rates with the APR, THM or DAE, not the headline rate, and ask how long each rate is fixed (fixed or variable rate shows how to test a rise).
• Your bank's exchange rate. Paying a euro instalment from a lei account means the bank sells you euros at its own rate, usually a little worse than the BNR's. Every 1% it keeps adds about 20 lei to each instalment in the example.
• The totals aren't discounted. A leu paid in 25 years is worth less than a leu today, so a rate move late in the loan hurts less than the totals suggest. The direction stays the same.
• Paid in euros? Then everything above flips. A lei loan from a euro salary is the bet, and a strong leu makes it more expensive. A euro loan matched to a euro income has no currency risk, as long as the income stays in euros.
• Your rights if the rate moves. Under EU rules the bank must warn you when the rate pushes your instalments or what you still owe more than 20% above what they'd be at the original rate, and you must have a right to convert the loan or another way to limit the risk [7]. Converting is done at that day's rate, though: it stops further losses, it doesn't undo the ones you've had.

Try it with your offers

Enter both interest rates from your offers in the calculator below. It fills in today's ECB rate and shows the two instalments in lei, the exchange rate that wipes out the saving, the past 20 years of rates against it, and what the euro loan costs in total if the leu keeps weakening at its past pace. Add your net income to see the 40% and 20% limits. Your inputs stay in your browser.

To see how the leu and forint have moved against the euro over the past months, the currency gain/loss calculator fills in the ECB rate for any two dates. If you're paid in euros and spend in lei or forints, budgeting a euro salary covers the other half.

Do this today

Ask each bank for both offers at the same amount and the same term. Convert the euro instalment to lei at today's BNR rate, divide the lei instalment by it, and multiply today's rate by the result: that's your break-even rate (6.6705 in the example). Then look up the highest rate of the past 20 years in the ECB's chart [1]. If you're paid in lei and the break-even rate isn't far above anything the leu has already seen, take the lei loan.

If you do take a loan in another currency, record it in the Volora app as a mortgage wallet in its own currency, with its outstanding balance. Volora projects the payment over the remaining term and counts the loan as debt in your net worth, converted to your main currency. Rates refresh every 30 days on the free plan and daily on Premium. More on tracking net worth in more than one currency.