A simulated payment describes a scenario: confirm that the product accepts the land, quoted rate and actual disbursement timetable.
Model a payment in Colombian pesos
Edit your assumptions. Results update immediately.
Enter a positive principal to preview the first twelve months and export the complete CSV schedule.
Fixed-payment model with a constant effective annual rate and end-of-month payments. This is not an offer, approval or UVR loan. Enter insurance and fees separately. Saved data stays in this browser; this tool does not send it to the server.
First establish which product can finance the land
The tool's name does not mean a mortgage has been approved for any advertised plot. Before entering figures, ask the institution whether its product accepts undeveloped land, which purposes it supports and what requirements apply to both the asset and applicant. Security, term, financed proportion and disbursement timing depend on the specific product; do not infer them from advertising for completed homes. Obtain written information on the rate, insurance, commissions, outstanding conditions and offer validity. The Financial Superintendence describes consumer information obligations that provide a useful basis for requesting an understandable breakdown. Record who issued each response and avoid treating a sales conversation as final approval. Where an appraisal or title review is required, establish who performs it, who pays and what happens if the property is rejected. This simulator begins after you choose principal and rate assumptions; it cannot determine whether a lender will actually provide that amount or accept that property as security.
Enter principal, term and expenses separately
Loan principal is the balance amortised by the model, rather than the land's full price or your deposit. Enter the term in whole months and the interest rate as an effective annual percentage. If a quotation describes a nominal, monthly, variable or benchmark-linked rate, obtain its equivalent and governing rules before copying it. The insurance field is a fixed monthly amount supplied by you; if the actual premium changes with age, balance or policy conditions, check the real schedule separately. Upfront fees increase the scenario's total payments but do not increase principal or accrue interest within this formula. If the contract finances those fees, adjust principal and document the treatment so they are not counted again. SFC cost disclosure guidance supports asking for an itemised explanation without replacing your institution's proposal. All monetary inputs are COP; using income received in dollars or euros requires a separate exchange rate assumption and a separate sensitivity exercise.
Convert the annual effective rate through compounding
For an effective annual rate EA written as a decimal, the equivalent monthly rate is (1 + EA) raised to the power 1/12, minus 1. It is not the annual percentage divided by twelve. The SFC provides a conversion tool and an explanation of constant payments in pesos against which to check this principle. For example, a hypothetical 16% effective annual rate corresponds to approximately 1.244514% effective monthly; dividing sixteen by twelve would produce a different rate. With that equivalent, principal P, monthly rate i and number of months n, the base payment is P × i / [1 − (1 + i) raised to −n]. At a zero rate, the model divides P by n. Payments are assumed to occur at each month end, without grace periods, arrears or staged disbursements. Correct conversion makes the mathematics internally consistent; it neither validates the quoted interest level nor confirms that a lender offers it to you.
Read a COP 180 million, ten-year example
Suppose you model COP 180,000,000 over 120 months at a constant 16% effective annual rate, with COP 180,000 monthly insurance and COP 2,000,000 upfront fees. These are educational assumptions rather than a current bank offer. Principal and interest payments are approximately COP 2,896,777, and the monthly payment including insurance is COP 3,076,777. Modelled interest over the term is about COP 167,613,189. Adding 120 monthly insurance premiums and the upfront fees produces total scenario payments of approximately COP 371,213,189. That total includes repayment of principal; it is not solely the additional cost of borrowing. Your initial contribution toward the land purchase is also excluded. Compare the payment with a household or business budget that already includes other commitments, rather than gross income alone. Irregular income does not remove the need to have cash available on the contractual payment date. Obtain the lender's amortisation schedule to compare rounding, insurance treatment and the actual terms.
Compare term and cost on a consistent basis
Keeping COP 180,000,000 and 16% effective annual interest while extending the term to 180 months reduces the base payment to approximately COP 2,511,145. With the same fixed insurance premium, the monthly payment becomes COP 2,691,145. However, interest rises to about COP 272,006,142, and total payments including premiums and upfront fees reach COP 486,406,142. A smaller instalment does not automatically mean cheaper financing. Do not assume the lender will offer the same rate for both terms either: the rate was held constant here to isolate the mathematical effect. Run a third scenario with the principal actually needed after completing your purchase budget, including only expenses financed under the contract. Compare principal, term, rate and insurance treatment consistently. If you change four inputs together, record why; otherwise the cause of the difference will be difficult to explain. The SFC helps check rate equivalence, while your decision also depends on liquidity and the stability of your income.
Distinguish this model from a UVR loan
This model holds the effective annual rate constant and expresses both balance and payments in pesos. It does not convert balances into UVR or forecast inflation. Banco de la República explains that the Unidad de Valor Real reflects changes in the consumer price index and serves as an accounting unit for housing loans. Entering a quoted UVR rate as though it were a fixed peso rate therefore does not reproduce that contract. Request a product-specific projection and its assumptions if the offer uses UVR, a variable rate or stepped payments. Grace periods, capitalised interest, extraordinary instalments and construction-stage disbursements likewise involve timing that this screen does not model. Do not mechanically add imagined inflation to a rate and present the resulting equivalence as certain. Simplified scenarios can support learning, provided their labels remain clear and the actual product receives separate evaluation. The official reference explains the mechanism; it does not predict future inflation or the exact balance of a particular loan.
Test affordability and outstanding conditions
To test a payment, separate regular income, essential expenses, other debts and reserves. The tool neither sets a universal debt-to-income threshold nor assesses credit history. Use your cash sheet to explore losing a client, delayed rent or an increase in household expenses. If the land currently produces no income, do not fund the first instalment on paper with rent that requires construction first. Also have an adviser check the fit between the preliminary purchase agreement and disbursement conditions: commercial approval is not the same as having funds available on an irrevocable date. Obtain the property's document requirements and ask which issues could block financing even if your income is sufficient. Consumer financial information should help you understand costs and conditions; retain the version supplied. Where the result leaves almost no emergency margin, the next action may be reducing principal or postponing the purchase, while recognising that a mathematically possible payment is not necessarily sustainable in real life.
Save the scenario and reconcile it with the offer
Download each alternative under a name identifying principal, date and term. The file contains this formula's inputs and results without bank validation. Browser saving lets you restore the version locally; it neither applies for a loan nor sends your information to an institution. Attach the written proposal, insurance breakdown, amortisation schedule and unanswered questions to the calculation. Compare the first payment, total cost, rate conditions and exclusions. For small differences, check rounding and dates; for material differences, request an explanation before concluding that the offer is wrong. Avoid placing complete personal identification in files intended for broad sharing. The useful decision at the end is specific: request a quotation compatible with the land, revise principal, investigate a different structure or stop progressing until a condition is clarified. The simulator organises analysis, while approval and the contract remain with the lender and parties. Refresh saved scenarios whenever the actual proposal changes instead of comparing an old estimate with new contractual information.
Fixed-model assumptions and limits sheet
Retain this worksheet with the downloaded amortisation schedule. The simulator shows a fixed-payment peso scenario; variable rates, UVR or a different schedule require separate assessment. Entered values are neither an offer nor approval.
| Item or decision | Information and evidence for your copy | Next check |
|---|---|---|
| Net principal, charges and purpose | Modelled amount, expected net disbursement, financed or separately paid costs and purpose discussed with the institution. | Reconcile them with cash needs; principal repayment included in the total is not merely interest cost. |
| Known rate and its expression | Entered rate, confirmed E.A. or required conversion, source, date and whether it remains constant. | Do not replace an unknown rate with zero; an example rate does not establish an offered term. |
| Term and first model payment | Number of months, end-of-period payments, contractual start, grace periods or different payments in the proposal. | Check correspondence with the actual schedule; the constant model does not automatically include those differences. |
| Insurance, costs and downloaded schedule | Assumed monthly insurance, initial costs, principal, interest, payment and schedule balance for selected inputs. | Review initial and final rows and save assumptions; the complete schedule remains a mathematical illustration. |
| Fixed versus variable or UVR comparison | Unit, index, change rule, insurance and schedule of an offer differing from the fixed model. | Obtain the institution’s explanation and schedule; testing another fixed rate is sensitivity, not an index projection. |
Sources & bibliography
Read the full document, its date, amendments and scope. The editorial review date describes this page; it does not establish an authorisation or a specific answer about your plot or financing.
- 01SFC · Simulador de conversión de tasas de interéswww.superfinanciera.gov.co · National
- 02SFC · Fórmula de cuota constante y tasa mensual equivalentewww.superfinanciera.gov.co · National
- 03SFC · Contenido mínimo de la información al consumidor financierowww.superfinanciera.gov.co · National
- 04Banco de la República · Unidad de Valor Realwww.banrep.gov.co · National