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Mortgage Payment Interest Query

RandomLight
RandomLight Posts: 4 Newbie
in Mortgages & endowments
Hi,

I have a quick question about interest on my mortgage payments.

I'm currently getting 5.24% on a £92000 mortgage over a 15 year term, I pay £731.62 (repayment mortgage). However, all the spreadsheet calculators I've tried state the amount should be £739.08.

What's more confusing, the online calculator for my bank (Smile) shows is should be £735.98.

I assume it's something to do with how the interest is calculated, but has anyone got a clear explanation for a financial jargon newbie ?

:)

Cheers

Comments

  • MortgagesInc
    MortgagesInc Posts: 156 Forumite
    Very odd - the quote software we use comes out with £739.08, and that's based on daily interest. If it was annual interest the payment would be higher again
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • 17Dave
    17Dave Posts: 158 Forumite
    I would have suggested the interest was calculated daily rather than yearly.
    However, the yearly rest payment would be £750.65, I also make the daily rest payment £739.08.

    Given the figures you supplied the interest rate should be 5.09%.
    So unless you are missing something in the quoted details you really are a MSE!!!

    I have checked my sourcing system for similar live quotes and these just confirm the above figures.

    Sorry, no explanation, just keep quiet and enjoy the £8 discount.
    "The true measure of a man is how he treats someone who can do him no good."(Samuel Johnson 1709-1784)


    Lots of years in financial services, still learning!
  • RandomLight
    RandomLight Posts: 4 Newbie
    Haha, thanks to you both. I'm going to go over the fine details of the mortgage to see if I can work out what is going on.

    The inital 12 months is a discount period. After that I will resort to 0.75% above base, so I was attempting to work out what that would be (although I may be looking at re-mortgaging by then).
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