first mortgage payment?

EllyBoo

hello!

We are hoping to exchange this fri and complete the fri after (4th nov). was just wondering if anyone had any idea when first mortgage payment will be? Have specified date for it to be paid of 1st of each month, will it be Dec or Jan? Does it vary from company to company? Ours is with northan rock.
Also if it's Jan will we end up paying double?

Just trying to budget for the move! - Thanks in advance

Woby_Tide

Probably Dec 1st and will probably cover 4th Nov - 31st December (I think or maybe 15th December). Quite a long time since we took out a NR mortgage but it was definitely an inflated payment first month

Sooler

Sometime since I took out a mortgage but if things haven't changed, if it's a repayment mortgage, then I'd think your first mortgage repayment will be 1st December. If you have a 25 year mortgage this will be repayment no. 1 of 300


However you'll also owe interest on the full amount borrowed for the period from 4th November to 30th November, 27 days, almost a full month. This payment is purely interest and is not part of the mortgage.

When I took out a repayment mortgage I read that is was better to complete on the last Friday of the month, to keep this initial charge of interest to a minimum.

If you completed on the 28th November then there would be only 4 days interest to pay, then your first mortgage repayment on the 1st December.

bingo_2

To be sure, you should phone the lender, quote your mortgage account number (on the mortgage offer) and ask them what the first payment will be, when it will be, and what the subsequent payments will be.
The first ever payment is never the same as the rest and in the worst scenario can be two and a bit months worth.
i.e. completed on the 28th (example above) however the direct debit has only 3 days to to be triggered and it takes 4 - so that carries over to the end of the next month, when the lender takes 3 days + one month in arrears + once month in advance.
If your particular lender does not take payments in advance then in the above scenario it would be 3 days + 1 month in arrears on the 1st of the month.
My guess is that you will pay whats owing on the 1st December and it will be 26 days worth (arrears) + 1 Month in advance (almost 2 months worth in one go, then 1 months worth after that)
But they are all different, so best phone and ask them
In my experience, when phoning to set up a new mortgage thay all answer the phone real quick - however, once they have you on board you join the massess of the great unwashed and end up in call queues for hours.
So you could always phone a local branch and ask to speak to one of their mortgage advisers who can find it out for you, if they object ("not my job") go back to the mortgage offer paperwork and phone the number on that.
If you used a broker, he can find out for you, but he will be phoning the same number as you.

[Deleted User]

I was asked what day of the month I wanted to pay the mortgage (I'm with another lender), check your mortgage offer or give them a call.

Sooler

..........

Sooler wrote:

If you completed on the 28th.

25th

Sooler wrote:

November then there would be only 4.

6

Sooler wrote:

days interest to pay, then your first mortgage repayment on the 1st December.

Sooler

How was Nov 4th arrived at for completion?

Was it suggested by the mortgage lender, or anyone else connected with the mortgage - an advisor getting a back hander/commission.

Was completion going to be the last Friday of October (small initial interest charge - 4 days) but it's just happened to accidentaly on purpose slip to the first Friday of November (large initial interest charge - 27 days)?

Jazzking

Just spent ages searching for this thread, and I'm not quite sure I understand....

I'm in a similar situation, just about to exchange contracts and need to think about a date for completion.


Our mortgage payment is set to come out on the 15th of the month (when we get paid) so would it be best to arrange a completion date of before this (9th) or after it (16th), in orderto not have to pay a huge amount for the first payment?

Will phone the lender tonight, but just wondered if someone could clarify...

Thx,
Alex

WiseInvestor_2

Sooler wrote:

you'll also owe interest on the full amount borrowed .... This payment is purely interest and is not part of the mortgage

Is this correct?

I'm hoping my remortgage will complete before Nov 30th when my existing deal with another lender comes to an end, if only to avoid an extorsionate SVR. It was explained to me that no payment is due for 14 days after completion. I should therefore expect my first mortgage payment to fall between 10-17th Dec with subsequent Direct Debits on the 1st of each month (starting Jan 1st).

The Initial Interest will either be minimal (a day or two) or ghastly (up to 30 days) depending on when it completes. However, I was told this was just an 'Interest Only' calculation charged per day (monthly IO premium divided by 31) and is deducted from the amount borrowed, although obviously no capital is repayed for this period.

Would a manual overpayment covering the difference between the Interest Only and Repayment premiums have the same effect as an on-time completion?

AndrewSmith

1st mortgage payment is normally 1 calender month after the date of completion, as you pay your mortgage payments one month in arrears.

You can amend you payment date but this is at the discretion of the lender and they will charge you pro-rata for the time between, eg:

If you complete on the 15th of the month and want to pay on the 1st, you will pay 1.5 payments on the 1st of the month following your original payment due date, ie 6 weeks after completion.

As I said this is the GENERAL rule however it is at the discretion of the lender.

Andy