Mortgage first payment

mr_cool

My mortgage completed on 26th Oct, they have taken a payment on 1st Nov for initial interest + one full months payment. Is this correct? I thought it would been on 1st Dec. Or just the intial interest now, then start monthly payments in Dec. How can they take payment for a month that hasn't accrued yet? Surely it works in arrears?

I could have waited till 1st Nov then would have only had a months payment on 1st Dec., seems silly.. Shouldn't they have told me this?

HBOS only wrote a few days ago with the initial payment date and amount!

TrickyDicky101

Hi

See Kingstreet's explanation here:

http://forums.moneysavingexpert.com/showpost.php?p=52813309&postcount=5

I gather you are borrowing from the Halifax side of HBOS?

mr_cool

TrickyDicky101 wrote: »

Hi

See Kingstreet's explanation here:

http://forums.moneysavingexpert.com/showpost.php?p=52813309&postcount=5

I gather you are borrowing from the Halifax side of HBOS?

Thanks

Yes Halifax. I thought they were a bank therefore would collect in arrears?

TrickyDicky101

Used to be a building society though. I'm with Nationwide and when I first took a mortgage with them 8 years ago my first payment was very nearly double the normal monthly amount. It caused me a big cash flow problem at the time (my fault I realise as I hadn't checked the documentation carefully enough).

dunstonh

My mortgage completed on 26th Oct, they have taken a payment on 1st Nov for initial interest + one full months payment. Is this correct?

It is disapointing that your mortgage broker didnt tell you this. Back in my mortgage days and mortgage adviser days, this used to be a mandatory requirement. Although, if you didnt use an adviser/broker and bought direct without advice then there is no-one to tell you as you are bypassing that.

How can they take payment for a month that hasn't accrued yet?

Monthly in advance is how most are paid.

kingstreet

Halifax issues a guide with its mortgage offer;-

http://www.halifax-intermediaries.co.uk/pdf/info-about-your-mortgage_10_.pdf

See C&D of page 3 of the pdf.

DilbertJones

Uh oh, this has worried me a little....

I complete on the 7th and the lender is Natwest, any idea what will happen with my first payment & how much more then the normal amount it will be?

Sorry to hijack the thread OP :A

kingstreet

Interest from 7th to 30th, plus payment for the month of December, debited around 1st January.

Verify with lender.

It is very disappointing hearing of borrowers who are only finding out about accrued interest by posting on here.

dunstonh

It is very disappointing hearing of borrowers who are only finding out about accrued interest by posting on here.

I agree if these are people who have use adviser/brokers. However, if they are non-advised then the information should be documented in the brochures/guides issued. Of course, that requires the person not getting advice to read the documentation that is issued. I suspect that doesnt happen a lot of the time.

mr_cool

I did it in branch. They should have advised me, to wait till the 1st I feel. It would have worked far better in terms of cash flow initially.

They said I can change payment date to end of month from now on but it is cheapest to keep it as 1st how does that work?

DilbertJones

kingstreet wrote: »

Interest from 7th to 30th, plus payment for the month of December, debited around 1st January.

Verify with lender.

It is very disappointing hearing of borrowers who are only finding out about accrued interest by posting on here.

I complete 7th November, so I assume debit day will be around 1st December?

incidentally i have accounted for paying my whole existing mortgage & 100 % of my new mortgage this month so I should be ok, doubly so if the payment doesn't come out until the December 1st as I will be accruing my own interest on that money for that duration.