Interest charged daily, monthly or yearly?

Morgage_Confused

mortgage current account is another mystery as I never had one before with other mortgages.

the mysterious factor is no matter how much i overpay the balance just goes more and more negative? and bears no relevance to my overpayments. Although my guess is its overpayments plus the capital portion from my normal monthly payment.

ViolaLass

Morgage_Confused wrote: »

the mysterious factor is no matter how much i overpay the balance just goes more and more negative? and bears no relevance to my overpayments. Although my guess is its overpayments plus the capital portion from my normal monthly payment.

You appear to be saying that your mortgage increases every month regardless of over payments but that seems unlikely. What do you mean?

getmore4less

Morgage_Confused wrote: »

mortgage current account is another mystery as I never had one before with other mortgages.

the mysterious factor is no matter how much i overpay the balance just goes more and more negative? and bears no relevance to my overpayments. Although my guess is its overpayments plus the capital portion from my normal monthly payment.

The amount you can OD in the mortgage current account goes up as the mortgage comes down, by an amount that you have overpaid(not exactly) by overpayments or regular payments beeing to much due to offsetting.

The idea it that you can draw thei and still pay the mortgage off on schedule with the regular payments.

IT should not be negative though unless you are using this to pay the mortgage or using the money, it should show as an OD limit on page 2 of the monthly statements.

Morgage_Confused

i dont get monthly statements....thats yet another problem I have with this mortgage as ive no idea how its going month on month...barclays only send out a yearly statement. my last mortgage, NR, i got monthly statements.

its just occurred to me.....are barclays taking my mortgage payments from the mortgage current account? because its going more and more negative month on month.

it currently says approximately

agreed overdraft limit -£10,000

Morgage_Confused

ok just rang india again....now I got a different answer which sounds more correct this time.

the lady said after an overpayment my mortgage repayments would not change. she said that once per year a mortgage statement is sent out at which time the repayments would be re-calculated to take the overpayments into consideration. she also assured me that there would be an instant benefit from the overpayment as the term would reduce somewhat. Im still unsure what happens at year end with the repayment re-calculation. At year end the statement should show a term reduction, followed by a repayment recalculation? Sounds double dutch to me.

also although my agreed overdraft limit is showing more and more negative on my online details, the lady in india assured me her screen showed it as positive.

Morgage_Confused

Ok rang India again after another overpayment. Just to check it went through. Overpayments so far are approximately 6k.
I was told by the call center lady that ALL my overpayments so far were doing nothing for my mortgage. Not reducing monthly repayments and not reducing term. This was because I had not asked them to apply the overpayments to the mortgage!

What a joke.....so what do Barclays actually consider I want to do with the overpayments, NOTHING, until I tell them to? Pure madness.

Now I was also told that if I had made an overpayment of EXACTLY 3 times my normal monthly repayment then it would be applied automatically and my repayments reduced and a letter sent out to state this. Then I would have to ring up and tell them not to reduce my monthly payment ( as I am looking to reduce term):mad:

Now to just add further info I was told that had I not rang up to apply my overpayments then only once per year(just happens to be September) they would be tallied up and a new monthly repayment calculated? Implying that I would be wasting my time overpaying if I dont ring them up and ask to apply overpayment to mortgage for perhaps a whole year.

Is any of this making sense because it sounds daft to me.

getmore4less

Sounds like rubbish to me.

What account are you making the overpayments into?

If it is into the mortgage acount then they will reduce the ballance.

I think the default is to reduce payments not term, so the recalculation at year end(now) may not change the term uness you elect for that.

I think it is best to keep the term long and then you can adjust your overpayments yourself as the normal payment reduces, gives greater flexability.

In the long run if you make enough payments the term will be shorter.

Morgage_Confused

After much googling it would appear this is not uncommon and has certainly been the way Woolwich/Barclays have been handling overpayments for many years now.

Some people have reported overpaying for many years without any benefit?

Member "sandraroffey" wrote on this very forum back in 2008...

Quote..

for several years my (now ex) husband were paying a lot more per month than we were supposed to off our mortgage. and it wasnt until we asked them something about something completely different, that they told us that our mortgage account was £4000 in credit. (payments made in advance)!! it hadnt been coming off the total at all.

they explained that this was because we hadnt formally informed them that we wanted our (proper) monthly payments re-registered at the new amount we wanted to pay!!

I cant understand how this is allowed as ive been through the T&C's and nothing is stated there about any of this.

Morgage_Confused

getmore4less wrote: »

Sounds like rubbish to me.

What account are you making the overpayments into?

If it is into the mortgage acount then they will reduce the ballance.

I think the default is to reduce payments not term, so the recalculation at year end(now) may not change the term uness you elect for that.

I think it is best to keep the term long and then you can adjust your overpayments yourself as the normal payment reduces, gives greater flexability.

In the long run if you make enough payments the term will be shorter.

My overpayments are directly onto my mortgage account(definately not the Mortgage Current Account) And they were sitting there as a credit to the account and had not been applied to it. My monthly repayments did not change so I assumed my term was reducing. I was told it was not reducing the term and had to formally tell her to apply the overpayments to the mortgage today. I cant remember when I began overpaying but luckily it hasnt been for very long so ive not lost out by much. Certainly lost out on £50 or so of interest.

foreversummer

My t&c say (the same as yours):

"What happens if you want to make overpayments?
A capital reduction of 10% can be made without early repayment charge. This will apply throughout early repayment period.
Following receipt of an overpayment or a lump sum reduction we will immediately reduce the balance on which interest is charged. This means that you will recieve the benefit straight away."

I just can't believe Barclays/Woolwich just hold it and do nothing with it. If they are then this is a very serious matter and they are in breach of their terms and conditions surely.

I've discovered that if you phone the Woolwich early in the morning or later in the day you often get through to a call centre in England. I think the Indian one is just an overspill if you like. Definitely worth a try and without the language barrier you could ask to speak to a superviser and maybe ask for it to be put in writing to you.

Keep us posted on what you find out.

Foreversummer