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Are monthly mortgage payments in advance or arrears?
RubyBish
Posts: 145 Forumite
Am I right in assuming that mortgage payments are made in advance each month?
So when you start a mortgage you make a payment on the first day to cover the following month?
I have made a capital repayment on the 28th of March and asked for the repayment amount to be reduced rather than the term reduced.
I was expecting that the monthly payment taken on the 1st of April would be the new amount as interest is calculated daily. However it was still the old larger amount. I cant work out if that is because they didnt change the DD in time or that monthly mortgage payments are actually paid in arrears?
So when you start a mortgage you make a payment on the first day to cover the following month?
I have made a capital repayment on the 28th of March and asked for the repayment amount to be reduced rather than the term reduced.
I was expecting that the monthly payment taken on the 1st of April would be the new amount as interest is calculated daily. However it was still the old larger amount. I cant work out if that is because they didnt change the DD in time or that monthly mortgage payments are actually paid in arrears?
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Ours are paid in arrears.0
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you live there a month and then pay, unlike rent where you pay then live there a monthIt's not easy having a good time. Even smiling makes my face ache.0
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My experience is that they are paid in advance. This is why the first payment is usually higher as you are paying the arrears from the date you moved in plus the month ahead.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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Our first payment is higher, but only by about 15 pounds. Since we completed on the 31st March, and the first payment is the 1st May, the can't be the payment for April in arrears+May in advance because it would be almost double.
I thought that the first payment is for April in arrears plus its a bit more equivalent to the 'extra' day, ie the 31st March. But obviously the size of the extra depends on the relative dates of completion and first payment.0 -
Some charge in arrears, some in advance. Who are you with?
I am guessing also that the cap rep made on the 28th of the month wil not have given them time to amend the direct debit in time for the 1st as the mortgage company will probably need a few days to amend your account and then change the dd info and by that point the dd will alreadyu be sat with the bank.I am a Mortgage AdviserYou should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
I'm with C&G as well and they are in advance.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0
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