Anyone good at maths? Overpaying my half of the mortgage (while partner doesn't do extra on his)

Thrugelmir

There’s no half of the mortgage. Both borrowers are jointly and severally liable. Keep that in mind. 

smith_616

QueenJess said:

I have virtually split the mortgage too with my DH as he didn't want to overpay upfront (although he has now changed his mind and is catching me up).

Anyway.  Get a spreadsheet set up showing the mortgage start, interest charge and capital repayment for each month that you have (just take it from the mortgage account details as it comes out each month).  Then for each of you, you will need the following columns: Monthly payment, interest, overpayment and principal balance.  Your monthly payment is just the payment per the mortgage divided by two.  Your interest is then the interest you are charged per the mortgage divided by the total mortgage outstanding and then multiplied by the remaining mortgage you owe.  Partners one is the same thing, but multiplied by the amount they owe.  Basically this just means you get the advantage of the lower interest because you decided to overpay more. 

Overpayment is obviously any overpayments you make.  The principal balance will be the balance you owe (total start - monthly payment + interest - overpayment). 

Does that make any sense?  Can throw something into Google Sheets later if I get time.

If you don't mind having a go at setting something up, I would be really grateful.  I think I have the information you have listed, but I then get confused by the rest and how it might all interact or work.  There is absolutely no rush though.  
As of the 1st September 2020, our mortgage has £55,774.12 left on it, with 11 years and 1 month.  Final scheduled repayment at the moment is 1st October 2031.  The interest rate is 0.89% which means that we pay £440.54 per month as a total.  
My partner will continue to pay his half, so £220.27.  I want to pay £720.27 (a monthly overpayment of £500).  And ideally would like the spreadsheet to somehow tell me when I stop, including the benefits of any extra interest saved by overpaying.  

It is really reassuring to hear that you have done this, and had the spreadsheet (and presumably bank statements) as 'proof' if needed.  I trust my partner too, although I guess things/people do change, but yes, like you the plan agreed between us would be for me to stop paying anything at whatever point that is, and he would continue because everything left would be his.  

I do completely get the concerns raised earlier though saying that actually my name is still on the debt even when I have in theory paid my half.  And I do need to think a bit more about this so am grateful for those that have raised this.   

smith_616

Barny1979 said:

smith_616 said:

Barny1979 and FtbDreaming - thank you too.  Your comments have certainly given me food for thought.  I trust him implicitly.  But... I am not silly enough to think that things can't change, and that people can change.  So yes, I need to think about this a bit more.  Our contributions to the house are already quite unequal (in his favour) as I paid for a lot more towards our extension than he did a few years ago.   

Where does his money go, do you have a joint account or a bills account that you put amounts in, sounds like he has a lot of spare cash and is not invested in the house the way you are, but is happy for you to make the living environment nicer for him without a financial contribution, but will benefit both personally and financially.

It is another very good point Barny1979.
We now both put an equal amount into a bills account which covers everything each month.  He does earn more than me, but I suppose not massively more after tax.  And the child benefit comes to me.  So it is OK really.  
Prior to the last 5 years or so, I historically paid WAY over and above what was equal, and have paid thousands and thousands more than him to support us and the kids (not even including the extension).  And he definitely benefitted from this personally and financially.  
Now things feel much fairer.  Although this thread is certainly making me reflect on the amount of money I have put into the house compared to him.  
It is really hard when he likes to spend his money on hobbies and what I would consider luxury frivolities, and I would rather invest in the house and the future.  Because in the past, if I didn't pay for things like new furniture, new carpets etc then it simply wouldn't happen.  Like I say, things are on a much more even keel these last few years.  

FtbDreaming

Oooh he sounds like my OH he wastes his money on drinking, car parts, lots and lots of takeaways and general rubbish. I pay all the bills and the mortgage and sort all the kids stuff out. The main difference between us is that my mortgage is in my name only and we’re not married so i think I’ll be ok in the respect that whatever I put in is mine for me and the kids. If he was able to take half back when he’d only contributed 1/4 then I wouldn’t be so keen to overpay. 

Having said that, it’s unfair for the thread to take a turn where it’s slating you’re DP, you just have different priorities for the future and there’s nothing wrong with that. Maybe you could think of alternative ways to use your money such as investing or saving the £500 a month then when you get enough to pay your half in a lump sum do it with the correct legal advice? 

Good luck anyway! 

getmore4less

I can do the numbers for the mortgage but there seems to be more than just this debt involved.
Can't remember if you mentioned the payment/term
 I recall the rate and amount were mentioned.
Need all 4 to do the numbers. 

getmore4less

OK we have the details

As of the 1st September 2020, our mortgage has £55,774.12 left on it, with 11 years and 1 month.  Final scheduled repayment at the moment is 1st October 2031.  The interest rate is 0.89% which means that we pay £440.54 per month as a total.  
My partner will continue to pay his half, so £220.27.  I want to pay £720.27 (a monthly overpayment of £500). 

Now mortgages are actually very simple when you break them down.
(there are some subtle issues but we can ignore those for now)

To start there are only 4 variable and you only need three of them to work out any mortgage.
Amount, rate, term, payment

At the core of most mortgages it is simple arithmetic   
One a month the lender adds interest and the borrower make a payment.

The interest a function of the balance on the rate
The payment is anything you want,

Every month we have
new balance = old balance + interest - payment
you just keep repeating that till balance is Zero.

Behind this is a technique call amortisation, this is some fancy maths that works out for a given amount borrowed, a rate and a term how much the payment should be to be the same for the whole term.

Now the great thing is all this maths is done for you with functions in excel 

your particular problem can be done  simply with a amortisation calculator 
quite a good one to see how all this works is 

http://www.whatsthecost.com/mortgage.aspx
but this only works on full years
putting your numbers in ( I will round the numbers).
£55,774 0.89% 11yr we get a payment of £444 per month
now switch to interest only and put £444 in
then look at the details and you can see how the payment is split between interest and capital 
Now the simplest way to do this is to split the mortgage in two
OH is 
£27887 0.89% 11years £222pm
put that into the calculator

I want to put down a lump sum of £7000 now and then overpay by £500 each month

as we said before you only need 3 things to workout the mortgage. now we have the amount the rate and the payment we can work out the term.
leaving the calculator at interest only put in 

£20887 0.89% 11years £722pm
The bottom line, is that this interest only mortgage for £20,887.00, over 11 years, will cost you £722.00 a month.
In taking out this loan, you'll pay a total of £235.21 in interest. By overpaying, you'll pay this loan off in 30 months..

Note the last payment is £184.

now if you look at the OH details for month 30. they still owe ~£21,800 
(£500*30+7k= £22k  that cross checks its in the right range)

Due to the way mortgages work in real life with payment dates weekends BH and different length of months the numbers do change a little from the ones you get in calculators it is usually just a few £.

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Chucking your numbers into my spreadsheet I get a payment of £440.53 which means you have the right data.
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having done all that you only need to find savings rates around 1% to make just saving for 2.5 years and then doing as a single payment once you have enough saved much simpler
Also saves the  numbers work for things like a rate change

prowla

I'm not quite grasping the concept of "partner" here.

smith_616

getmore4less - thank you for working all of that out.  Amazing!  I really appreciate it.  I have printed it out to read and digest properly at the weekend (particularly the suggestion at the end). 
ftbDreaming - thank you for your supportive post also. It is easy to get derailed isn't it.  And yes, different priorities.  
Thanks everyone.