Mortgage interest

mondello

I have my mortgage with Halifax and I can see the amount when I log on to my online banking. My mortgage DD is on the 1st of the month but always I see on the 1st that my amount owing has increased from the day before and a couple of days later it is then reduced. My agreement says my interested is calculate daily but is it added to the balance on a particular day? Is is better to change my DD day to a few days earlier so that I don't see this increase as I don't want to be paying extra interest for those few day.

I hope this is understandable.

BoGoF

It won't make any difference. Interest is calculated daily but then is only added to your online balance monthly when a payment is made, although the payment comes off the following day

Thrugelmir

BoGoF wrote: »

It won't make any difference.

The earlier repayment is made the less interest you'll pay. Though the difference will be be minimal.

opinions4u

mondello wrote: »

I have my mortgage with Halifax and I can see the amount when I log on to my online banking. My mortgage DD is on the 1st of the month but always I see on the 1st that my amount owing has increased from the day before and a couple of days later it is then reduced.

The accounting system the generates your online balance lumps on month's interest on the first day of the month. Any payment made usually gets deducted on the next working day.

My agreement says my interested is calculate daily but is it added to the balance on a particular day?

Your interest is calculated daily. It doesn't matter when it's added to the balance.

Don't get hung up on the balance displayed online. It doesn't include ERCs or discharge fees and doesn't update interest acrrued daily. It's a useful guide but it's not an accurate settlement figure at any given point in time.

Is is better to change my DD day to a few days earlier so that I don't see this increase as I don't want to be paying extra interest for those few day.

The earlier you pay, the less interest you will pay. But the benefit will be modest. You'd be better overpaying.

mondello

Thanks for the info. My DD was for the 28th orginally but I had to change it to the 1st because I was always paid on the last day of the month so sometimes things were tight. Starting a new job with a payday on 22nd so I might change my date back to 28th.