NATWEST - Interest to Anticipated Redemption Date ?

73Jonathan123

It's a capital and interest mortgage. Interest rate is 4.24. There's no early repayment penalty as I was tied in until Dec 31st last year. Repayments are currently 22.95 a month.

Poppet627

Hi I’m new to this site and have a question also about interest being adde to my redemption statement that I was not aware of and it over a thousand pounds

Poppet627

My last statement was April and a remortgaging on Friday 2nd August and natwest have said it’s £1054 in interest I owe them. From reading on here I can see people saying you pay interest in arrears but I thought the monthly payments included interest?

kingstreet

You make a last payment on a given date leaving a balance of £x.

NatWest collects in arrears, so every day which passes thereafter increases £x by the daily interest.

By the time of redemption, £x has become £y which is £x + the number of days interest since the last payment.

Example;-

£100,000 balance at last payment date. Interest rate 4.24%. Daily interest is therefore £11.61.

If redemption takes place 21 days after last payment, we have a redemption figure of £100,000 + £11.61 x 21 or £100,243.81.