Date of 1st mortgage payment

binerds81

hi there, I have a question if anyone can answer for me please?

I have just had my mortgage application approved and looking ahead to exchange and completion (hopefully in around 6 weeks, property is vacant & sols already started searches) I am wondering how the 1st payment works and what period it would cover?

If I complete mid August, would the first payment be made 1st September for 6 weeks (1/2 august and all september?) or would the lender expect a payment before 1st September?

Or if I complete in the first week of August would I pay for 3 weeks immediately and then a whole month from 1st September?

thanks for any advice

doryfish

You pay the first payment on the day of completion usually unless you organise something particular with your lender.

binerds81

ah, thanks doryfish - is this in until the end of the month, and then on 1st I just pay the normal monthly amounts?
example, if I move in 6 weeks on Friday (21st August) then I will pay 10 days mortgage and then again by direct debit on 1st September?

thanks, sorry if being a bit slow, just planning cash flow for first few months for things like sofa/bed etc that I will need to purchase

libf

I've never paid on completion, I've always paid extra on the first payment due to cover the gap between that payment and completion. With Woolwich I paid on the 16th of the month (or there abouts) and with Nationwide it's currently the first of the month.

Best to ask mortgage lender/broker.

Beancounter

We completed on our house purchase on June 19th and our first payment will be 1st August. That will be a whole £9 more for that month,

Senior_Paper_Monitor

I am not aware of any lender except Skipton that can collect on day of completion - there may be others, but certainly not many.


If the payment is coming from a direct debit (almost always the case) the lender must give a period of notice (Skipton get round this by providing that notice in a complex wording within the offer).


Name the lender and one of us should be able to give you the formula

TrickyDicky101

Beancounter wrote: »

We completed on our house purchase on June 19th and our first payment will be 1st August. That will be a whole £9 more for that month,

You sure about that? Unless you have a very small mortgage/rate that seems too small to cover the extra days (which may only be June 19th to 1st July).

GRBWA

With Skipton you can actually add the interest accumulated from completion date to the mortgage .

Then the normal monthly payment is taken on 1st of the month

Senior_Paper_Monitor

Please note I used the word 'can' with regard to Skipton.


The actual wording within Skipton's offers read ...


The Society will confirm the amount of the monthly payment on or shortly before completion.


A payment will also be requested to cover interest from the date of completion to the end of


the month in which completion takes place. If payment of this sum is made to your account


during the month of completion no interest will be charged on it. Full monthly payments will


start on the 1st day of the month following completion.


... so if you complete on 1st you pay your first monthly payment on 1st.


This was more in response to 'doryfish' than in response to the OP.


For the OP - it all depends on which lender is in play for them.

Beancounter

TrickyDicky101 wrote: »

You sure about that? Unless you have a very small mortgage/rate that seems too small to cover the extra days (which may only be June 19th to 1st July).

My mortgage was only for £19,400 and the rate is 1.25% so it is correct.:)

TrickyDicky101

Beancounter wrote: »

My mortgage was only for £19,400 and the rate is 1.25% so it is correct.:)

That's awesome. You don't fancy swapping mortgage debts with me do you? ;-)