tart - overpaying mortgage by £8500

wallet_2

i got figures from mortgage co today - am i missing something here.
i make 1 off overpayment of £8.5k to mortgage. they then reassess it and if i let it run still for 19.5 yrs.

after 9 months, i withdraw £8.5k - the mortgage repayments return to current ammounts

they say mortgage repayments for the 9 months will reduce by £58/month therefore in 9 months £8.5 makes £522 and if i reinvest that in savings it might make further £19. !!!!

am i right with all those figures ?

Robert_Sterling_3

I think what you are missing is the fact that when you pay £58 per month less than before some of that £58 per month would have been repayment of capital. You are not repaying as much capital per month as hereforeto. So when you take the £8500 out again the monthly payments, in my humble opinion, will be a tad higher than they were prior to your overpayment of £8500. As you do not tell us the amount of your mortgage, your monthly payment, the interest rate charged or your mothers maiden name I can say no more.

wallet_2

lol - far be it from me to tackle your humble opioin but it is 19.5yrs of a 25yr and therefore most of repays are interest. i was told that if base interest was same rate, my repays would revert next sept to exactly same and of course the period is not altered

- i understand that i am paying the same interest as someone with a £8 less mortgage spread over a risky 19.5yrs.

eg b4 change £16000 mortgage 19yrs - monthly = £200
after - £8000 mortgage over 19yrs - monthly = £100

i mean these figures hint at maybe 9% anum interest made on the orig £8000 !!! but it sounds too good !

Robert_Sterling_3

£522 as a percentage of £8500 is a tad more than 6% but as this is for a period of 9 months it converts to a tad over 8% for a period of a year. 8.19% to be more precise.

I note that you still have not told us what rate you are paying on your mortgage.

wallet_2

its tracker .5 above base rate think at mo its oops not sure about 5% derr cant find papers re last rate increase

but any how isnt 8.somthin % stunning in its own right ?

hopefulfooluk

Sorry to blow your thunder a bit but if you dont know your percentages EXACTLY then you are not ready for stoozing.

If you need the bank to do the maths for you then you certainly shouldn't be doing it.

Robert_Sterling_3

I am more hopeful than you.

hopefulfooluk

sorry I just don't want the poster to get stung by lots of interest or worse, or t's & c's that mean the overpayments can't be borrowed back again. If the £8500 was paid onto the mortgage and then they refused to let it be withdrawn again, imagine the problem that would ensue with 8.5k on a credit card that wasn't at 0%. Not a nice situation!

I didn't want to put the poster off, just make sure that they were aware that there is always a risk to these sorts of things.

I am very hopeful that things work out for ceeebeee!

Chris

wallet_2

one of the best credentials is steely discipline and that i nearly overdose on.

nationwide call the shots , my or your maths is academic.

i am ASSURED by themselves at the call centre that i can be reissued with a cheque for the £8.5k payable within 5 days.

if they agree to something i have safety net against t&c

at just £16k per anum earnings i do need to tread carefully and hence read and pick brains .. but at end of day i run it by the issuing authorities and get their names and therefore remain as safe as the next guy.

thanks for your concerns anyhow but still i ask isnt it pheonominal to recoup £540 on £8500 in 9 months?

or is there something i'm missing here

dthyer

I agree with Pale-Rider. When the mortgage company re-calculate your payments, they do it on the assumption that you are then going to proceed in that way for the rest of your mortgage. So the new payment figure that is £58 less per month is correct, in that if you carried on at that rate for 19.5 years, with no other capital withdrawals or repayments (apart from the standard monthly repayments), then at the end your balance would be zero.

But when you withdraw the £8500 back out, I think you will find that your mortgage balance will be slightly higher than it would have been if you hadn't done any of this. I estimate by about £140, so your profit will be more like £400, rather than £540.

The only way to really be sure is to play with a spreadsheet.

I hope this helps,

DT

wallet_2

MY NATIONWIDE TRACKER ALLOWS UP TO £500/MONTH OVERPAYS BUT HIGHER THAN THAT AND ITS REASSESSED AND THEREFORE I GET LOWER MONTHLY REPAYMENT

WILL COST £21 IN PENALTY BUT STILL THINK IT RETURNS ME MORE THAN I WOULD GET IN HIGHEST INTEREST A/C PLUS IT ISNT SEEN AS INCOME THAT WOULD AFFECT TAX CREDIT !!!

OHHH TOO BE THAT POOR

... BUT GETTIN RICHER - TA MARTIN