Reducing mortgage payment and no term

hyposmurf

When I set up my mortgage and also after it has started running I contacted my mortgage provider to check if the mortgage overpayments I was making were actually reducing the term and they confirmed yes that is the case.I noticed recently my statement is showing that the payments are reducing?My intention is to pay the mortgage off as quickly as possible.

I've contacted them and they have confirmed that the monthly payments are reducing each month and not the term!The other odd thing is that the same figure is taken each month even though I would've thought it would've reduced.It seems I pay the same figure the monthly minimum mortgage figure reduces but the overpayment increases.

For example I pay £800 a month, £600 of this is my min monthly mortgage payment the rest being overpayment.
Over the term I still pay £800 but the min amount reduces to £550 and overpayment increases by £50.

I'm little confused over this, they say its not reducing the term but surely it is as my total payments (min mortgage plus overpayment) aren't being reduced over the term?

Will this above arrangement mean I would have less impact on paying my mortgage of early, than if I had a mortgage that was reducing the term rather than monthly payments?

getmore4less

It is the payment that determines the term of the debt

the contractual term is just to set the contractual payment.

as long as you keep paying overpaying the debt will be paid off before the contractual term.

hyposmurf

OK thanks that is what I thought.So its really just their terminology that confuses things, I'm actually reducing the term anyway by my overpayments.That's put my mind at rest.

Thrugelmir

Does your lender collect the same amount every month?

Do you make the overpayments manually?

Savingdad

My overpayments don't seem to effect either my term or my minimum payments but I know I will pay it off well before my term simply because the debt is reducing far faster than my morgage prediction