completion and first mortgage payment

katy89_2

Does anyone know the rough timescale of knowing when the first mortgage payment is from completion.

It said i should receive the letter in due course, i was just wondering if it will be in the next week or so i find out through the post the details.

Yorkshire bank said i couldnt pay by DD because i didnt bank with them (seemed strange) so they said i have to pay by standing order. I have chosen the 28th of every month but i dont know whether they will be wanting a payment in August or if it will be Sept now. (i completed today) I have no account details to pay to as well.

I tried contacting them but it takes so long on the phone to get through so had to give up in the end.

Thanks in advance

Gold_bullion

It usually depends on when completion happens in the month and if they have offered a preferred payment date - you say this the 28th.

Normally you won't have to make a repayment within the first month of completion - the loan term will normally commence on completion day and so repayments are not normally due until at least a month later. Often if an agreed payment date falls after this date then the first part-month payment will be amalgamated with the second. So my expectation would be a larger than usual payment on 28th Sept.

Standing Order (S/O) mortgage payments (i.e. fixed by the payer) are very unusual and to be avoided if possible. The reason for this is that the risk of a wrong payments is high as the repayments can change when interest rates change or a deal runs out. Even if it is a fixed rate, it is still usual for payments to be by Direct Debit (D/D) and in any case the payer always has control with D/Ds as they can request a refund from their bank if an error is made. Not banking with Yorkshire is no reason not to accept a Direct Debit payment from your own bank (the whole point of D/Ds is that they are from one organisation to another) - I have never banked with my mortgage provider (including my current three) and have never paid by S/O in over 30 years of having mortgages of one type or another. In using such a method you risk swingeing charges by the mortgage provider if you miss or underpay a repayment, whereas by D/D there can be no issue as they ask for what they want, and if you later disagree you have recourse. £50 is a typical fee for a late or missed mortgage payment. With an S/O the onus is on you to get it right, whereas with a D/D the onus is on them.

I find it very hard to believe that Yorkshire Bank don't utilise D/Ds for mortgage repayments as I would have thought that it would surely save them no end of administration hassle with their customers.

Robochick

I was a bit thrown by that too. It really just depends on when you move in.

I'm a first-time buyer and moved in on the 15th June (YAY!). I have always requested that all my payments go out of the same account and therefore choose the 1st of each month

My first mortgage payment therefore was on the 1st July and ended up being £1871.03 (ouch) , and my next one on 1st August was the figure in the paperwork, of £1315.

However when I thought about it, I was actually quite lucky, because if I had completed slightly later in the month, I'd have had my first payment on 1st August, and would have had a portion of June, all of July and the August payment to stump up.

Hope this helps.

Robochick

Robochick wrote: »

I was a bit thrown by that too. It really just depends on when you move in.

I'm a first-time buyer and moved in on the 15th June (YAY!). I have always requested that all my payments go out of the same account and therefore choose the 1st of each month

My first mortgage payment therefore was on the 1st July and ended up being £1871.03 (ouch) , and my next one on 1st August was the figure in the paperwork, of £1315.

However when I thought about it, I was actually quite lucky, because if I had completed slightly later in the month, I'd have had my first payment on 1st August, and would have had a portion of June, all of July and the August payment to stump up.

Hope this helps.

Actually, I've just re-read the booklet and my last paragraph above isn't correct, it wouldn't have been nearly as bad as I made out there!

I'm with Halifax (as a first-time buyer and a self-employed contractor, my options were limited). They say that:

"we will always collect the first repayment in the month after your mortgage starts. For example, if we release your loan in June we'll collect the first repayment in July.

When you applied for your mortgage we asked you which day of the month you wanted to make your monthly payment. We will collect on the day you chose, except where there are fewer than 4 bank working days between when we release your loan and your chosen date. If this happens then we will collect on the 10th of the month."

I don't have any other basis for comparison but I can't imagine other mortgagers would be that different...

Helix

My payments are setup for the 8th of the month, I completed on 31st July and my first payment was taken on 8th Aug. I got a letter on the 10th Aug saying first payment would be taken on 8th Aug (really helpful).

This is with Lloyds TSB, a requirement of my mortgage was that I had to open an current account with them and fund it with £1000 a month so I moved my current account over to them but the direct debit was still setup to my old account. Luckily I guessed they might take payment so transfered some money in the day before.

katy89_2

Thanks, I'm worried about it now because I don't want to miss my first ever payment. I was really taken aback as well with yorkshire bank and the direct debit situation. the mortgage adviser said this was the case but I don't know whether it was a tactic for me to open a bank account with them.

I'll have to call them Tuesday or go into branch because if the case is I have to pay by 28th I may have to make a cash payment if that can be done (hopefully yes it can)