Daily interest vs annual interest

AirCooledHeaven

Spoke to my mortgage lender yesterday to confirm my balance, during the call they asked if I'd like to switch my mortgage from annual interest calculation to daily interest calculation, no fee involved. Now I've always assumed that daily interest calculation is better, but I start to worry when financial institutions offer me 'better deals' without any apparent benefit to them...

So is this switch a 'no brainer', or am I missing something??

Thanks

CLAPTON

devils in the detail
have you read your T&Cs; is the mortgage really annual interest i.e. worked out on the balance at the beginning of the year and ignoring monthly payments?

would the interest rate be the same with the daily as the yearly?

facts always help

AirCooledHeaven

CLAPTON wrote: »

devils in the detail
have you read your T&Cs; is the mortgage really annual interest i.e. worked out on the balance at the beginning of the year and ignoring monthly payments?

would the interest rate be the same with the daily as the yearly?

facts always help

Currently: Interest is calculated on an annual basis from Jan 1st. Overpayments during the year reduce the balance immediately but the interest is not recaluclated until year end (unless the overpayment is greater than 3 x the monthly mortgage payment).

Good point about the interest rate, I guess it's not what they tell you, it's what they don't tell you. I will check.