Quick question

ytfcmad

I personally have a re-payment mortgage with HSBC but something i have all ways wondered was if you have an endowment mortgage and you want to re-mortgage after say 2 years, 5,years 10 years etc are you all ways borrowing the original sum or a sum minus what any repayment product has accrued?

opinions4u

Asusming you've met your payments, the amount outstanding should be more or less the same as you've borrowed.

But do you really want to continue relying on an endowment to repay your debt at the end of the term?

ytfcmad

So if you remortgaged after 5 years the amount you need to borrow would be the same as when you first took the mortgage out?

ytfcmad

opinions4u wrote: »

Asusming you've met your payments, the amount outstanding should be more or less the same as you've borrowed.

But do you really want to continue relying on an endowment to repay your debt at the end of the term?

If your not actually paying off the sum borrowed only the interest it shouldn't be "more or less the same" it should be exactly the same.

(Excluding additional borrowing and possible fees)

maninthestreet

ytfcmad wrote: »

So if you remortgaged after 5 years the amount you need to borrow would be the same as when you first took the mortgage out?

Yes it would.

ytfcmad

maninthestreet wrote: »

Yes it would.

A much more exact/concise answer than an ex bank manager was able to give, not surprising given the state the banks are in.

Thanks

begbeer

Afraid I have to difer and agree with ex bank manager, as have done it alright it was only a few pounds different but it was different, something to do with when i wanted to remortgage and when my payment was due

opinions4u

ytfcmad wrote: »

A much more exact/concise answer than an ex bank manager was able to give

It is totally up to you who's advice and information you choose to take and how you choose to interpret it.

But it won't be exactly the same because interest is usually calculated on a daily basis, so the likelihood is that on 30 days out of a 31 day month the figures won't be exactly the same as the sum originally borrowed.

Additionally, if your lender has at some point changed your interest rate mid-month but not amended your mortgage payment until the following month then the amounts will, again, not be exactly the same.

Also, if you pay on a date different to the contracted payment date, your settlement figure will also differ. Paying late, missing a payment and making up later, paying a month in advance etc can also all affect the final settlement figure.

In other words a reply of "the amount outstanding should be more or less the same as you've borrowed" seems to be pretty reasonable to me.

not surprising given the state the banks are in.

Well I'll be damned. It was all my fault!!

My apologies for taking the time to try and give you an answer that addressed the question asked. I was a bit pushed trying to earn a living so didn't give you the fuller explanation it appears you needed, but next time I'll make the effort to give you an incorrect answer instead.

Life isn't always black and white.

maninthestreet wrote: »

Yes it would.

For the reasons stated above, it almost certainly wouldn't. But it should be fairly close.


INVITATION TO OTHER POSTERS WHO HAVE REDEEMED INTEREST ONLY MORTGAGES:

Feel free to state if you redeemed for the exact same amount as that borrowed, or an amount that was "more or less the same as you've borrowed", but not exactly the same.

ytfcmad

Well I'll be damned. It was all my fault!!

My apologies for taking the time to try and give you an answer that addressed the question asked. I was a bit pushed trying to earn a living so didn't give you the fuller explanation it appears you needed, but next time I'll make the effort to give you an incorrect answer instead.

Life isn't always black and white.


I was possibly a tad harsh:rotfl:

But i cant see how the original sum borrowed can change if you are paying the interest only?

getmore4less

ytfcmad wrote: »

Well I'll be damned. It was all my fault!!

My apologies for taking the time to try and give you an answer that addressed the question asked. I was a bit pushed trying to earn a living so didn't give you the fuller explanation it appears you needed, but next time I'll make the effort to give you an incorrect answer instead.

Life isn't always black and white.


I was possibly a tad harsh:rotfl:

But i cant see how the original sum borrowed can change if you are paying the interest only?

The way interest is caculated(daily) and the payments are made(monthly), explained above.

The differences will be small but can be different if you pay the same every month(which a lot of people like).

Some lenders only change the payments one a year and this can have a significant effect on the debt(up or down) untill the new calculation is done.