Nationwide undercharging mortgage interest?

tlloyd87

Hello,

I've noticed a discrepancy in my Nationwide mortgage account - my most recent interest payment (which is taken on Jan 01 every year) seems too low.  I overpaid quite a lot last year, but not nearly enough to account for it.  By my calculations, assuming daily calculation and annual compounding, I should have paid £2809.40 on 01 Jan 2020.  Instead, I paid £1124.11.  That's almost exactly 40% of what I was expecting - the number's so close it can't be a coincidence.

Any idea what could be going on here?  Should I expect a nasty bill?
Tom

davidmcn

Not sure anybody else can help without seeing the relevant figures.

Thrugelmir

Sounds as if your calculations are wrong. 

tlloyd87

davidmcn said:

Not sure anybody else can help without seeing the relevant figures.

I don't mind sharing that.

Rate = 2.29% APR

2018
Opening balance 01 Jan = £128,081.83
Interest charged 01 Jan = £2837.96
Payments through 2018 = £6443.99

2019
Opening balance 01 Jan = £124,475.80
Interest charged 01 Jan = £2793.33
Payments through 2019 = £7590

2020
Opening balance 01 Jan = £119679.13
Interest charged 01 Jan = £1131.52

It's significantly lower (less than half) compared to my previous two annual interest charges, even though my balance hasn't dropped anything like that much.  See what I mean?

TrickyDicky101

That's because only half a year has elapsed so far - that is the interest for the current financial year (2020).  There is no annual compounding - it's just a presentational thing.

tlloyd87

That makes a lot of sense - I'll check back tomorrow and see if the number's changed.  The online statement clearly shows it on January 1st, though - very misleading!