How is the ‘Total amount repayable’ calculated please?

sonnydeletejc

I did a mortgage search today on Uswitch, based on a loan of £118,000 over a 5 year fixed rate. Here’s one of the results…

Provider: The Loughborough BS
Initial rate & duration: 4.24% / 60 months
APR: 4.99%
Total amount repayable: £15,792.60
Fees: Completion £499
You pay (Monthly Repayments): £730.07

With my basic knowledge of Mortgage calculations I’m struggling to determine how the Total amount repayable mentioned is calculated. Can anyone give me a clue?

I did my own calculation, and this is what I came up with…

Over a 5 year term, if I’m paying back £730.07 per month, I make that a total outgoing of £44534.27, of which £20712.30 is interest – so where are they getting £15,792.60 from?

I realise my calculations might not be bang-on accurate (i.e. the completion fee, and possibly give-or-take a month’s payments in to those figures) but I can’t see how they come up with that number.

Can anyone advise me please?

Thank you.

J

cathh70

The interest ins't a flat rate across the whole mortgage. Early on you pay less capital/more interest, later on it swings the other way and the more capital you have paid off, the less interest you pay.

sonnydeletejc

Thanks for the reply cathh70, yes that's right it does change over time, and from my calculations the interest I would pay on month 1 would be £416.93, and month 60 would be £262.16.

So…

Month 1, £730.07 = £416.93 interest + £313.14 capital repayment
Month 60, £730.07 = £262.16 interest + £467.91 capital repayment

But I'm trying to determine where the £15,792.60 figures is derived from.

martinsurrey

As far as I can see that figure is a complete waste of time.

i looked at a 250k house with a 200k mortgage 25 year term and 5 year fix

a mortgage with the same fixed rate %, same fixed rate term, a lower subsequent apr and lower product fees was £5k more in thier total amount repayable!

kingstreet

I'm looking at a KFI for a NatWest mortgage I did recently. It's £116k over 23 years. The total amount repayable is £195,944.

I don't know what the site you're looking at is doing, but the only thing you should be relying on is a penny-accurate, FSA-approved Key Facts Illustration.

This also tells you how much you pay back per £1 borrowed, in this example, £1.69 and the APR 4.0%.

Doshwaster

The "total amount repayable" is fairly meaningless anyway as it's unlikely that the interest rate will remain unchanged for the entire term or that you won't remortgage to another supplier.

getmore4less

You need to supply full term(20 years?) and follow on rate.


are you sure it said total amount payable and you got the . in the right place.

whats the link?

sonnydeletejc

Thanks everyone.

This is the link to the page I was using - http://www.uswitch.com/mortgages/comparison/

I should have stated that it was a 20 year mortgage, but [FONT=&quot]with a 5 year fix.[/FONT]

I've just looked again, and that particular deal is gone already. In fact the results have changed completely - I didn't realise mortgage deals were so volatile! Regardless you'll see in the results where it mentions "total amount repayable".

It must relate to something!?

getmore4less

got me what it is will have another look later