Upfront interest on C&G mortgages?

badgerswood

I've just mortgaged with C&G and was surprised to be hit 11 days after completion with an interest bill for 42 days interest i.e. it seems that they charge a months interest up front and not after youve had use of the money. Is this a normal practice amongst lenders?

homer_j_3

it is not uncommon for lenders to take the initial interest (interest accrued from day funds released by lender) up to the 1st payment date. They will often then take payment for the monthly payment.

Your solicitor should have advised you of this and/or your broker.

badgerswood

thanks homer - we completed on the 29th May - on June 11th C&G took 11 days interest PLUS a normal monthly payment - on July 1st they'll take another monthly payment - by my reckoning on July 1st I'll have had C&G funding for 32 days but will have paid 73 days interest!

dunstonh

You pay in advance with C&G

ohmsoft

Surely you should only have been charged 3 days interest for 29, 30 and 31 May plus one whole month for June on the 11th - your normal monthly payment would resume on 1 July (In advance).