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How to work out payments?

Hi all,

The purchase price of the flat we had an offer accepted on is £207, 500. We have 5% deposit.

Our AIP with the abbey was for £240k max, and then if we found somewhere with a lower purchase price we would look at other deals.

How do we work out what our payments will be with a rough interest rate of 5.5%?

Sorry i just cant seem to get my head around it !

Comments

  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    its not easy to work out my yourself.

    if you have EXCEL spreadsheet the the following will work

    =PMT(monthly interest rate, months,principal,0)

    where monthly interest rate is 5.5%/12
    months is number of months (25years is 300)
    principal is amount borrowed.
  • Feanor
    Feanor Posts: 513 Forumite
    Yikes...

    Sorry that went over my head a bit! I'll ask my other half to see if he can figure it out!

    Thanks.
  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    example

    loan of £150,000
    25 years (=300 months)
    loan interest rate 5.5%

    then type in a EXCEL cell

    =PMT(5.5%/12,150000,300,0)

    and it comes out at -921 so its telling you your monthly repayment is 921 per month
  • Cara79
    Cara79 Posts: 580 Forumite
    Ok, Let me see if I can work this out.

    If you've had an offer accepted for £207,500 and have a deposit of 5%, then you are looking to mortgage for £197,125.

    A repayment mortgage on that amount over 25 years and at 5.5% is approx £1,210 per month. On interest only this would be £903.49.

    Does this help?

    I just used this calculator http://money.guardian.co.uk/calculator/form/0,,603156,00.html

    cara
    x
  • kingkano
    kingkano Posts: 1,977 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    This seems to be a handy calculator I use alot

    http://www.ucbhomeloans.co.uk/intermediaries/if3_payment.html
  • Feanor
    Feanor Posts: 513 Forumite
    Thats fantastic, thankyou very much!
  • kingkano
    kingkano Posts: 1,977 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    welcome. I found it very useful when comparing deals, changing the IO/repayment portions or even lengthening the loan. I can see instantly what the difference is and compare to my hearts content! lol
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