Initial mortgage repayment double

Keira_B

Hi all

We've had our schedule of repayments through and will be asked to pay double our usual amount for the first instalment. Out of interest, we were wondering why this might be?


Thanks

kingstreet

The date of the month in which you complete determines the amount of "accrued interest" you pay.

If you complete on 2nd of the month, you pay interest from then, until the month end, plus your full month's payment for the month after, as most lenders debit payments in advance.

This can be avoided by completing at the month end, so your first payment is a normal month's payment, or just a couple of days on top.

dunstonh

Out of interest, we were wondering why this might be?

This is something your mortgage adviser should have told you. However, another mortgage adviser, kingstreet, has it spot on.