Mortage repayment amount

thebullsback

Hi everyone.We have a Tracker Mortgage that due to a legal slip up is guaranteed at 0.99% above BOE base rate.
The Mortgage was for £40000 over twenty year and started in 2004.
I have today out of curiosity put these figures into a mortgage calculator and it tells me I should be paying £188 per month is this correct please??

Boredatwrork

How much do you currently owe?

kingstreet

No.

The monthly payment will change as the rate and outstanding balance changes, so you need to know what the amount outstanding is now if you want to work out the payments at 1.24% for the remainder of the term.

thebullsback

On avarage I have had £212 per month claimed by Direct Debit for several years .

kingstreet

thebullsback wrote: »

On avarage I have had £212 per month claimed by Direct Debit for several years .

Which is probably the payment on the outstanding balance at that time based on 1.49%, the base rate being 0.5% at that time.

getmore4less

£40k base + 0.95% 20y 2004

Not sure why you think there was a legal hick up that's what loads of people have, some are even cheaper.

anyway lets give it a go just for fun

base rates
Thu, 04 Aug 2016 0.2500
Thu, 05 Mar 2009 0.5000
Thu, 05 Feb 2009 1.0000
Thu, 08 Jan 2009 1.5000
Thu, 04 Dec 2008 2.0000
Thu, 06 Nov 2008 3.0000
Wed, 08 Oct 2008 4.5000
Thu, 10 Apr 2008 5.0000
Thu, 07 Feb 2008 5.2500
Thu, 06 Dec 2007 5.5000
Thu, 05 Jul 2007 5.7500
Thu, 10 May 2007 5.5000
Thu, 11 Jan 2007 5.2500
Thu, 09 Nov 2006 5.0000
Thu, 03 Aug 2006 4.7500
Thu, 04 Aug 2005 4.5000
Thu, 05 Aug 2004 4.7500
Thu, 10 Jun 2004 4.5000
Thu, 06 May 2004 4.2500
Thu, 05 Feb 2004 4.0000

very rough guess on year, amount, No of years @ average rate, payment,

2004 £40,000 1y 5.50% £275pm
2005 £38,750 2y 5.75% £280pm
2007 £36,350 1y 6.50% £300pm
2008 £35,200 1y 5.75% £280pm
2009 £33,800 8y 1.50% £210pm
2017 £16,700 7y 1.25% £208pm

The lower the rate the more capital you pay off each month for a given amount owed so the early years paid relatively less as they were at a higher rate.

eg. for a £40k loan over 20 years @ 5.5% you pay £90 off the debt in the first month, on a rate of 1.25% you would pay £147 off the debt.

those early years on a high rate meant there is more to pay off on the low rate than if it had been a low rate all along.


This is with no overpayments and assuming you only make a contractual payment at the rate changes.

getmore4less

thebullsback wrote: »

On avarage I have had £212 per month claimed by Direct Debit for several years .

Which from my very rough calculations is close enough.

I have explained above why this happens.

thebullsback

You have explained that fantastically well I thank you all .Thank you