Mortgage dumbo but easy for you!

Blue3

Hi all, I have a very small question but one which I have had 2 separate answers to:

I am about to start a mortge and have opted for 19 years fixed rate 77k and the payment is 522 per month. The standard variable is something like 486 per month. If I go with the fixed rate deal ,,,is the extra that I am paying each month getting paid off my mortgage as opposed to being a product cost?? Have I explained this ok? Thanks for your help.:beer:

feisty1

Was yr mortgage arranged by an adviser, if so I would go back and ask them to explain it all to u again. Remember, this is the biggest financial commitment you will ever make and an adviser had a duty to ensure you understand your mortgage.

Blue3

She probably did...I am just not very good at understanding all this. I haven't asked her this...this has just occurred to me as a friend said that at the moment she wouldn't go fixed. But if I can afford the higher rate I want to know if it is coming off my debt or not and I am ok with that.

_Andy_

Blue3 wrote: »

Hi all, I have a very small question but one which I have had 2 separate answers to:

I am about to start a mortge and have opted for 19 years fixed rate 77k and the payment is 522 per month. The standard variable is something like 486 per month. If I go with the fixed rate deal ,,,is the extra that I am paying each month getting paid off my mortgage as opposed to being a product cost?? Have I explained this ok? Thanks for your help.:beer:

Sounds like the fixed interest rate is higher than the standard variable. Therefore the increased payment reflects the higher interest. So, in answer to your question - "no", it's just more interest you're paying.

Graeme7777

It seems that you're being charged a higher rate of interest on the fixed scheme so the price of the money is simply higher so you're NOT paying more off your debt, simply being charged more for it.

I would get whoever sold you the mortgage to clarify asap.

Good luck!