Overpayments on Interest only mortgage

Novosaver10

Novosaver10 wrote: »

Thanks; Im really grateful for all the quick replies. 1; Sorted! 2; OK! 3: Yes; we are alowed "Mortgage Holiday" already, but of course the news of us actually repaying the Capital has been even more sweeter. My Credit cards are fine, but excisting other loans are not welcoming adjustments or overpayments, which is a shame and ridiculous. Anyway you've all given me something to mull over, Im sure if I just sat down and took advantage of my rare days off, we could do even better! Cheers!

P.P.P.S We have been overpaying since March , so yes its already 'Counting Down ' nicely

pauljrog

Can you please answer my question.

My BTL mortgage is a part capital part interest mortgage, if I pay overpayments every year will that pay off the interest part or the capital part??

I would like it to pay off the interest part as I would like to reduce the amount needed to pay when the mortgage comes to an end.

Thanks for your help.

Paul.

claire1234

hiya,

this is probs a daft questions but as this thread is about interest only mortages i thought id ask my question here if you dont mind,
this is just a example so i can get it clear in my head if someone can help,

for example:
if you have a interest only mortage of (one hundred thousand) £100000
and the monthly payments are £300
you overpay to get the mortgage down to £99,000

will the monthly interest only payments be calculated on the new amount of 99 or the original mortage amount?

thanks in advance,

redpete

pauljrog wrote: »

Can you please answer my question.

Better to start a new thread rather than tack on the end of an existing one.

My BTL mortgage is a part capital part interest mortgage, if I pay overpayments every year will that pay off the interest part or the capital part??

I would like it to pay off the interest part as I would like to reduce the amount needed to pay when the mortgage comes to an end.

Either way any overpayment will reduce the capital owed by the same amount so I don't think it matters.

redpete

claire1234 wrote: »

this is probs a daft questions but as this thread is about interest only mortages i thought id ask my question here if you dont mind,

better to start a new thread otherwise it gets confusing as to which question an answer applies to

for example:
if you have a interest only mortage of (one hundred thousand) £100000
and the monthly payments are £300
you overpay to get the mortgage down to £99,000

will the monthly interest only payments be calculated on the new amount of 99 or the original mortage amount?

The interest charged will be based on the lower amount now owing. The amount they take as the monthly payment might be treated differently by different lenders - so best to ask them directly. In my case with the Coop the monthly payment I make stays the same, at least until an annual review, so my overpayment increases each month by a small amount.

claire1234

redpete wrote: »

better to start a new thread otherwise it gets confusing as to which question an answer applies to

The interest charged will be based on the lower amount now owing. The amount they take as the monthly payment might be treated differently by different lenders - so best to ask them directly. In my case with the Coop the monthly payment I make stays the same, at least until an annual review, so my overpayment increases each month by a small amount.

thank you very much,

didnt want to start up a new thread cos it was just a quick question,
just planning in my head then might give them a ring after the weekend

thank you.