Fixed Rate Mortgage Statement shows different Debit amounts

triple-clones

Hi,

I have just received the annual statement for our Fixed Rate mortgage, but I am confused, even through the credits shown for each month are the fixed repayments we have, there is also a column labelled "Debits" which has a varying amount in each month, the total of this column is labelled "Interest"

Also the balance shown is more then the summary we were given when we took out the mortgage - I'm misunderstanding the term "Fixed Rate" or is something amiss here?

Many thanks

opinions4u

It may help if you named the lender.

But a couple of suggested reasons:

1) There are a different number of days in each month (or the accounting period used for the statement).

2) If the debt is reducing slightly each month, the interest cost should also fall slightly each month (subject to adjustment for number of days).

Also the balance shown is more then the summary we were given when we took out the mortgage

By summary, I'm not sure what you mean. If it's some sort of reducing balance schedule it will have certain asusmptions in it. The timing of your monthly payments can mean that a typical mortgage doesn't match £ for £.

Indeed, does the payment reflect all credits for a year, or is one not on there as it hadn't been accounted for at the time the statement was produced?

triple-clones

Hi opinions4u,


Missing info:

The lender is RBS

I had thought about the number of days, however the amount doesn't vary by a logically amount, so 24/09/2010 shows £962.96, 23/03/2011 shows £862.61 then 26/07/2011 shows £951.34, and there are no two amounts that are the same.

When we took out the mortgage we were given a "Key Facts" document, which on the last shows "Summary of mortgage payments" shows what the remaining debt should be, this is over a £1000 less then the closing balance on the latest statement. There is one payment outstanding on the latest statement but it in no way comes near to a £1000.00

Many thanks.

opinions4u

triple-clones wrote: »

I had thought about the number of days, however the amount doesn't vary by a logically amount, so 24/09/2010 shows £962.96, 23/03/2011 shows £862.61 then 26/07/2011 shows £951.34, and there are no two amounts that are the same.

But if the debt has been reducing each month, the value of the interest for the same number of days will be slightly different from one month to the next.

Take a look at the accounting period for the 23rd March. It will have included a chunk of February which is a 28 day month. So you would expect this to be around 10% cheaper than a 31 day month.

When we took out the mortgage we were given a "Key Facts" document, which on the last shows "Summary of mortgage payments" shows what the remaining debt should be, this is over a £1000 less then the closing balance on the latest statement. There is one payment outstanding on the latest statement but it in no way comes near to a £1000.00

How much is your monthly payment? If interest is around £900 I'd assume higher.

triple-clones

Yes that's it thank you.

When I look it carefully thinking about the number of days in each of the previous month, the amounts are reducing.

Thank you very much for helping me understand it

Cheers