When is your first mortgage payment

puregeordie

Hi, I've looked around the forums but not sure about the answer.

When you get a new mortgage out, your first payment is always more expensive than the rest, why is this.

Also when is your first payment, is it at the begining or after the first month paying on the 1st of each thereafter,

Much appreciated.

GwylimT

Our mortgage goes out on the 1st of each month, however it technically goes out on the first working day of each month. Our first mortgage payment was more as we moved in mid month, so we moved in mid February, a mortgage pays the month ahead, so our payment in March covered the time we spent in the house in February and the whole of March, it was almost covering a six week period.

kingstreet

Your regular mortgage payment is normally on the date you requested from your lender. A few may have fixed dates, but most ask the borrower for their choice.

The first payment again depends on the lender. Some lenders collect in advance, so your first payment will be a full month, plus "accrued interest" from the completion date to the end of that month. The payment is normally around two weeks after completion to around the middle of the next month.

If you use a lender which collects in arrears, you could wait nearly two months before you make your first payment. Clearing banks always used to collect in arrears, building societies in advance.

You will be notified of payment amounts and dates shortly after completion.

StuC75

Interest is charged from the date that the mortgage company advances the mortgage to the solicitor.

The First payment is the 'broken' interest for the remainder of the start month, plus the next months full payment.

when this is taken can depend on when you select for the payment to be made and whether they can setup the DD in time and notify you accordingly..

I know with Britannia that I pay on the 28th, and when last moved last time we completed on the 6th of the month (May) they took a part for the interest Early June, then the June Regular payment at the end of the month,, and so stopped it being almost 2 payments in one. It was all notified, expected and budgeted for..
The lender should write to you on completion to confirm what the amounts are..

this is sometimes people look to complete on the last day of the month so that there is less broken interest charged.. but either way you start getting charged from the day they advance.. its more a psychological thing..

puregeordie

Thanks for prompt replies, I understand know and wait.