Is Natwest charging me too much for my mortgage ?

Thrugelmir

Sunny2good wrote: »

I've used lots of mortgage calculators including Karl's mortgage calculator and other spreadsheets available on this site, and they all tell me that after 11 months of repayments, my Balance should be £165,547.24 and capital paid off should be 2701.76. Interest charged should be 9324.65.

I believe that you are a month out in your calculations. As your mortgage repayments are made in arrears. You have been charged interest for the period 1st Feb to 28th Feb on your statement, but do not make payment for this period until the 1st March.

Once the payment on the 1st March is taken into account then the figures more or less tally. With what the balance should be at the end of year 1 after 12 monthly repayments.

Balance 165,294. Interest 10,165. Capital 2,955

The slight discrepancy will be down to the month in which you drew down the mortgage funds. As interest is charged daily and charged monthly. So isn't the same amount every month.

Sunny2good

Whats confusing me is that when i completed and moved in on the first, why would i be charged interest only for the first month? If i moved in on 1st March, the payment on 1st April should cover capital and interest for March isnt it?

Opinions4u: The statement is from 26th Feb 2010 to 25th Feb 2011. So contains summary of 11 payments. Even if what you say is correct, and i have been charged 12 months interest but only 11 mortgage payments, after 11 payments (according to all calculators), my balance should be £165,547 and not 166,397.15 (as reported by Natwest).

getmore4less

The statement is from 26th Feb 2010

Thats probably when your mortgage started, solicitor draws the money a few days early to make sure they have the funds before completing.

So 12months interest 11 payments.

TrickyDicky101

Can you access your mortgage details online with NatWest? If you do so you can check to see that your outstanding balance has been reduced more or less by the payment taken on 1st March 2011.

opinions4u

Sunny2good wrote: »

Opinions4u: The statement is from 26th Feb 2010 to 25th Feb 2011. So contains summary of 11 payments. Even if what you say is correct, and i have been charged 12 months interest but only 11 mortgage payments, after 11 payments (according to all calculators), my balance should be £165,547 and not 166,397.15 (as reported by Natwest).

The calculators will almost certainly assume that you pay your mortgage payments in advance.

It would appear, from what you've posted, that with Nat West this isn't the case.

Sunny2good

Hi everyone,

Thanks for your input. I am still confused as to how first payment and interest is calculated but i guess the best thing to do was wait till 1st year is over and see what the end balance is. As TrickyDicky101 suggested, called Natwest to find out Balance after March payment went out (Thus making it a complete year). The calculators suggested that my balance at end of year 1 should be £165,294, called up Natwest and they said it was £165,303. Not a long way off so in the end it all comes together nicely. The calculators are not that bad eh ?

Now I can use them to work on overpayments and hopefully take off 7-8 years off my mortgage

I appreciate everyones input, thanks alot.