Confused my capital repayments are being properly processed

zebedy

Hi folks,

I'm hoping some of the more mortgage -knowledgeable of you can help me.
I re-mortgaged and started my new mortgage with Abbey on April 1st (this isn't an April Fool!)
The mortgage was £81516.00 for 20 yrs and is a tracker at 0.23% above BR (so started at 5.48%)
My first payment (21st April) was £427.73 with subsequent payments of £559.81 on 21st of each month.

On April 10th BOEBR dropped to 5% so my interest would be 5.23% (although i think Abbey start it from the following month)

So, I then became a proud MFW club member.
I started making overpayments by cheque stating in the cover letter that it should be treated as a cpaital repayment to reduce the term and i wanted my usual monthly direct debit payments to remain the same.
Each time i made a capital repayment I then got a letter back stating the amount outstanding on the mortgage, and the term outstanding.
After a couple of months I changed to making these capital repayments by online transfer from my current account (to save the cost of a stamp)and following up with a phone call to ensure they would be treated as capital repayments and not overpayments that could be clawed back.(I can't access the mortgage account online)

So, here's all the figures. What I'm confused about is that as well as reducing the term it also seems to be reducing the total and so i'd like someone more savvy to check it is all correct.

24 April 08 - £300 (cheque) - £81028.44 outstanding, 19 yrs 10mths
20 may 08 - £300 (cheque) - £80539.43 outstanding, 19 yrs 8 mths
28 May 08 - £1100 (cheque) - £79439.43 outstanding, 19 yrs 2 mths
20 June 08 - £300 (online) - £78938.02 outstanding, 19 yrs 0 mths
16 July 08 - £1305.77 (online) - £77429.33 outstanding, 18 yrs 5 mths
18 July 08 - £1000 (online) - £76428.60 outstanding, 18 yrs 0 mths

So in total I've overpaid £4305.77 and reduced the total by £5087.40 and reduced the term by 2 years

Is this all correct? Why is the amount reducing as well as the term?
Thanks for bearing with me, sorry it's so long.

Rebob

The total should reduce as this is the money that you are repaying each time you make the capital repayment. The monthly repayments should then stay the same and the term decrease as it is doing.

HTH

Rebob

Sorry duplicate post

zebedy

thanks, that's good news. I just needed a sanity check as I'd got myself all confused and worried.
Unfortunately my overpayments for the next month or 2 will be smaller as i've just found out i need a new water tank in my flat - £640 !!!!

Rebob

zebedy wrote: »

thanks, that's good news. I just needed a sanity check as I'd got myself all confused and worried.
Unfortunately my overpayments for the next month or 2 will be smaller as i've just found out i need a new water tank in my flat - £640 !!!!

They are thoughtless these home repairs......get in the way of the overpaying!!! lol:D

Keep going though, you are doing really well!