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mortgage over payment question
Mr_Incredible
Posts: 247 Forumite
I'm a little confused, as an example I tried the early repayment calculator on this site, I plugged in £250,000 mortgage and then indicated a one off overpayment at day one of £100,000.
On the basis of an interest only mortgage i would have thought then that the outstanding balance would be £150000 for the remainder of the term, except it doesn't show this, even with no more overpayments in the future somehow the balance slides below £150,000?
What is going on here?
On the basis of an interest only mortgage i would have thought then that the outstanding balance would be £150000 for the remainder of the term, except it doesn't show this, even with no more overpayments in the future somehow the balance slides below £150,000?
What is going on here?
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Comments
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Does it assume you continue to pay the same monthly payment as you did when you owed £250K? If so, you've effectively turned the difference into a regular overpayment.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0
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Why would you want to know what happens if you overpay £100,000 on day one?I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
kingstreet wrote: »Does it assume you continue to pay the same monthly payment as you did when you owed £250K? If so, you've effectively turned the difference into a regular overpayment.
your a very smart dude, that may explain the methematics behind the topsheet, essentially though I only indicated the interest rate at 2.14% I did not specify a mointhly amount absolute. So I guess it depends on whether the programme recalculates the 2.14% against the £150,000 (rather than the original £250,000). Im nopt sure
http://www.moneysavingexpert.com/mortgages/mortgage-overpayment-calculator#result0 -
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Why wouldn't you just borrow £150,000I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
kingstreet wrote: »Does it assume you continue to pay the same monthly payment as you did when you owed £250K? If so, you've effectively turned the difference into a regular overpayment.
That's exactly what it has done0 -
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