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Q about how interest is worked out
slopemaster
Posts: 1,581 Forumite
in Loans
I recently took out a loan to pay off the last bit of my mortgage, as the interest on a personal loan was actually less than my mortgage SVR.
My mortgage was interest only, but this way I will be paying it off over 5 years. But, I need to know how much of what I am paying is interest, for when I do my tax.
I have a figure for the APR, for the total amount of interest payable, and for the monthly payments, which stay the same over the term of the loan. But I don't seem to have anything that says how much of the monthly payment is the principal and how much is interest.
How is it normally worked out?
Am I paying more interest (and less principal) at first; then less interest and more principal as the debt reduces?
Or, is it somehow worked out on the 'average' amount owing. so that the interest remains constant?
Or do I need to ask them?
It's making my head hurt trying to work it out; please help!
My mortgage was interest only, but this way I will be paying it off over 5 years. But, I need to know how much of what I am paying is interest, for when I do my tax.
I have a figure for the APR, for the total amount of interest payable, and for the monthly payments, which stay the same over the term of the loan. But I don't seem to have anything that says how much of the monthly payment is the principal and how much is interest.
How is it normally worked out?
Am I paying more interest (and less principal) at first; then less interest and more principal as the debt reduces?
Or, is it somehow worked out on the 'average' amount owing. so that the interest remains constant?
Or do I need to ask them?
It's making my head hurt trying to work it out; please help!
0
Comments
-
You will get a statement from the loan provider which will show the interest added to the account each month. It's more in early months and less towards the end of the term.:footie:
Regular savers earn 6% interest (HSBC, First Direct, M&S) Loans cost 2.9% per year (Nationwide) = FREE money. 0 -
Ah, OK. Thanks for the super-fast reply!0
-
slopemaster wrote: »Ah, OK. Thanks for the super-fast reply!
put
'loan amortisation calculator'
into a search engine
the internet is wonderful0 -
It is, when you know what to look for!0
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