How much interest?

lauraw82

Would you lovely people be able to tell me how to calculate how much interest I am paying each day for my mortgage, I'm sure I saw it on here somewhere a little while ago but can't find it for looking now.
If its any help our outstanding mortgage is £87604 at 1.5% with officially 18 years left, and although our monthly payment should be £450.43 we actually OP by an extra £300 (while we are lucky enough to be able to afford to!)

financialbliss

Hi lauraw82,
Bit surprised that no regulars around here have replied yet...

Two ways to calculate daily interest

Log in to your mortgage account if available online and note the balance two days running. If your interest is added daily, you should see a difference in the balance - that's your daily interest.

Second option is to calculate it. £87,604 @ 1.5% interest is:

mortgage x ( rate / 100)

eg 1.5 would be 0.015. I make that £1,314.06 a year in interest. Divide by 12 to get monthly interest, divide by 52 to get weekly interest and divide by 365 to get daily interest:

Monthly: 109.51
Weekly: 25.27
Daily: 3.60

At a mortgage rate of 1.5% - that's pretty low and you should be able to get a better rate on a savings product rather than overpaying on the mortgage and review as the interest rates change.

Hope that helps,

Financial Bliss.

lauraw82

Thnk you for that Financialbliss! I'm aiming for a 2 pronged attack, half our 'spare' money into savings, half OPing, so hopefully when we come to move we'll get a good deal

HappyMJ

lauraw82 wrote: »

Thnk you for that Financialbliss! I'm aiming for a 2 pronged attack, half our 'spare' money into savings, half OPing, so hopefully when we come to move we'll get a good deal

I agree with financialbliss. You will be better off not making any overpayments and investing all the 'spare' money into savings accounts. When it comes to moving you can use those savings to get a good deal.