Resolved l

rainbow_fountains

Deleted as resolved

getmore4less

It will vary by lender

My interest gets added on the 1st of the month(daily interest, compounded monthly).
My payment goes out on the 16th of the month.
My statements show daily balance.

£260k 1.89% £945pm  would work out at 30y 1 month full term

Interest around 1st payment 
£260000 * 0.0189/12 = £409.50pm
£260000 * 0.0189/365 = £13.46pd

Looks like around 1 months interest.

How much did the balance go down when you paid the £945?

rainbow_fountains

getmore4less said:

It will vary by lender

My interest gets added on the 1st of the month(daily interest, compounded monthly).
My payment goes out on the 16th of the month.
My statements show daily balance.

£260k 1.89% £945pm  would work out at 30y 1 month full term

Interest around 1st payment 
£260000 * 0.0189/12 = £409.50pm
£260000 * 0.0189/365 = £13.46pd

Looks like around 1 months interest.

How much did the balance go down when you paid the £945?

It’s gone down to £259,470.14.

Here’s more accurate figures that aren’t off the top of my head: monthly payments are £946.77, interest charge was £416.91

vacheron

That makes sense then.

Your monthly payment was £946, of this, they "charged" you £416 in interest which was the cost of borrowing £260,000 for this month, but this leaves £530 left over, so this goes to reduce your amount borrowed by £530 (from £260,000 down to £259,470).

This means that next month you will pay a tiny bit less interest as the amount you owe has dropped by £570 (0.2%), but as your payments stay the same each month it means you will pay a tiny bit more off the loan, and so on and so on until at the end of the term your payments will consist of almost entirely capital repayments and only a tiny amount of interest.  

getmore4less

rainbow_fountains said:

getmore4less said:

It will vary by lender

My interest gets added on the 1st of the month(daily interest, compounded monthly).
My payment goes out on the 16th of the month.
My statements show daily balance.

£260k 1.89% £945pm  would work out at 30y 1 month full term

Interest around 1st payment 
£260000 * 0.0189/12 = £409.50pm
£260000 * 0.0189/365 = £13.46pd

Looks like around 1 months interest.

How much did the balance go down when you paid the £945?

It’s gone down to £259,470.14.

Here’s more accurate figures that aren’t off the top of my head: monthly payments are £946.77, interest charge was £416.91

£416.91 that looks like  31 days interest

£946.77 == 30 years full term.

the numbers look right with that new balance.

rainbow_fountains

Thanks everyone!

nyermen

The fixed payment part is often called "Constant principal and interest annuity" (if you google that you can find info on modelling).

For note - some banks (HSBC for example) are normally okay to calculate the monthly numbers (I've done it with excel) but I can't work out how they calculate extra interest for when the payment date is a non-working day (as they move it to the next date and charge the extra interest in the following month).  Albeit its a few pence so it doesn't really matter.

MovingForwards

@rainbow_fountains this is a public forum when people search for things when they have a problem. By deleting your query it means that's no longer available to help someone else in a similar situation.

Redwino222

Please don’t delete threads like this.  No one else will understand the advice, so people time is wasted.  

If you want to embrace the ethos of this site, and say thank you to those who have helped, retro’s your query.

FTB_Help

MovingForwards said:

@rainbow_fountains this is a public forum when people search for things when they have a problem. By deleting your query it means that's no longer available to help someone else in a similar situation.

@rainbow_fountains you have a habit of doing this, i remember reading another thread of yours and later seeing the original post and your replies deleted.

People who read these posts are looking for advice and experiences from others too, so you deleting is so unhelpful.

People take time out to reply to your post, if you keep deleting posts maybe everyone should stop replying or giving advice to your queries

getmore4less

This is the 4th time



https://forums.moneysavingexpert.com/discussion/6241101/chain-questions#latest

https://forums.moneysavingexpert.com/discussion/6241655/gap-between-exchange-and-completion#latest

https://forums.moneysavingexpert.com/discussion/6253952/deleted-as-resolved#latest