First Mortgage Payment

yomonkeyboy

Hi all,

We've just received our mortgage offer for our first home and I'm just wanting to know both when the first mortgage payment will be and also what it will be, I've heard people say double, and others say just the same amount.

• We are accepting the offer and taking the mortgage on Friday which is the 7th August.
• When signing the Direct Debit Mandate I agreed on the payments leaving my account on the 5th of every month.
• The mortgage is £505.00 per month.

Does this then mean that the first payment will be on the 5th September and be for £505, or will it be £1010?

Or will the first payment go out on the 5th October and be for £1010?

I'm mega confused!

Can anyone shed a little light on this please?

Much appreciated,
YoMonkeyBoy

lee111s

Are you completing on Friday? If so, the lender will actually start charging interest from a few days before that, as it's charged from the moment they release the funds to your solicitor (usually a couple of days before completion).

It should tell you in your KFI that you got with the mortgage offer what the first payment should be and when, if not they should send you a letter.

You'll pay interest from the day mentioned above. The lender will calculate how many days from the funds leaving their accounts, to the first payment date, and add the interest on to that. For arguments sake, if your charged £10 per day interest and you get the funds on the 5th, you'd pay an extra 31 days of interest on your first payment. So you first payment would be £815.

That is just an example. Ideally, speak with the lender, they will be able to tell you exactly how much the first payment will be and when it'll be taken.

mrstick

Not sure if remortgage are different, but mine completed on 22nd July and my first payment is 1st September for the normal monthly amount.

getmore4less

The actual numbers will be lender drawdown date dependant

Plan/budget for double payment and then if you have anything left once things are done use the surplus to overpay a bit.

So much easier when dealing with this house purchase & remortgages of thing to build in some cash flow contingency as timing the outgoings to when you get paid in line with income is not necessary.

Even with the best timing there can be an overlap where some money is in limbo.

yomonkeyboy

We are completing the mortgage on Friday and getting the funds released Friday, getting the keys the same day.

I think daily mortgage interest is about £12 a day so it's gonna be 30 x £12....

That is 30 days from the 7th August to 5th September when my Payments are due out.

So on the 5th September I should expect a payment £865.00 which is my normal payment of £505.00 plus the 30 days before, so in theory I'm paying my mortgage upfront every month?

We've got the money to cover it, I'm just confused as to how it works - thats why I'd like a little clarification.

Thanks,
Kieran

Dandytf

I paid almost double when I moved home 5yrs ago

mtg was 343 p/m 1st payment 650.

kingstreet

This will depend entirely on the lender.

Some collect in advance, others in arrears. This will determine the date of the of the first payment.

It may not be taken on your chosen payment date. That will be for your subsequent regular payments.

You will probably have accrued interest added to the first payment and this will be for 7 August to 31 August.

Jemima09

I completed 3rd July, first payment was 1st August and nearly double the standard payment.

kingstreet

Jemima09 wrote: »

I completed 3rd July, first payment was 1st August and nearly double the standard payment.

Likely a building society, or former building society as it was collected in advance.

First payment included accrued interest from 3/7 to 31/7.

kingstreet

mrstick wrote: »

Not sure if remortgage are different, but mine completed on 22nd July and my first payment is 1st September for the normal monthly amount.

Likely a clearing bank, which collects in arrears. A whole month between completion and payment.

Jon_B_2

kingstreet wrote: »

Likely a building society, or former building society as it was collected in advance.

First payment included accrued interest from 3/7 to 31/7.

Slightly off topic. On what basis do Nationwide collect payment?