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Mortgage payments
kezzygirl
Posts: 996 Forumite
Hi everyone, merry Christmas!
This has probably been covered before, but as a first time home owner for the last 7 months
I have noticed our mortgage amount is not actually going down, our payments are only just covering the interest. Is this correct?
This has probably been covered before, but as a first time home owner for the last 7 months
I have noticed our mortgage amount is not actually going down, our payments are only just covering the interest. Is this correct? 0
Comments
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Nothing out of the ordinary.
How long is your term?0 -
As in, it hasn't gone down a penny? Even on a 40 year mortgage, the capital balance should still come down even a tad....I am a Mortgage Broker.
You should note that this site doesn't check my status as a Mortgage Broker, 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 advice0 -
Probably, the first few years you usually only pay a very small part of the capital, that is why is is in your favour to make overpayments if you can and your mortgage allows overpayments.0
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It states: advance £171,000. One off fee £999.
Interest paid to date £3968
Interest rate 3.64%
First payment June £1162. Payments monthly thereafter £786.
Balance £169,9680 -
So it has come down...0
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Yes, it is coming down, just slowly. This is standard for the early years of a capital repayment mortgage.I am a Mortgage Broker.
You should note that this site doesn't check my status as a Mortgage Broker, 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 advice0 -
£170k 3.64%, interest is over £500pm0
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your payments were approx £2k more than the interest for the period...assuming your loan was added to the balance then this looks correct. as each year goes by you will switch to paying less interest and more balance0
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Thanks for verifying it is correct. Guess i expected it to come down a little bit more than that, but then it is still early days0
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Was the fee added to the mortgage or did you pay it upfront?I’m a Forum Ambassador and I support the Forum Team on the Debt free Wannabe, Budgeting and Banking and Savings and Investment boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.
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