Have I got my interest payments right, and question about overpaying

Iwanttobefree

Hi

£150,000 morgage over 35 years, fixed for 10 years at 3.08%.

Is this right please?

First month of the mortgage repayment, with an interest rate of 3.08%, if you pay £600,   £385 of that is interest, so you pay off £215 of your actual mortgage leaving £149,785.
Then the next month, you pay 3.08% £149,785, so the interest is £384.50  so your £600, £384.50 is interest and you pay £215.50 off your debt, which now leaves  £149,569.50

Reason I ask, is I'm trying to work out how quickly the mortgage can be cleared if either 10% overpayment per year is done (I know it's a lot in the first years), or more realistically 5% per year overpayment.

Plenty of overpayment calcs on the web that say a one off % payment, but none (well I couln't find one) that allow for an annual % overpayment paymernt.

Many thanks

BikingBud

Try this calculator, you can play with the numbers and see what works best for you.
http://excelworks.co.uk/default.aspx?page=30100&alias=Download%20Excel%20Mortgage%20Calculator%20Spreadsheet

Use the formula "=k12*.1" or "=k12*.05" for your "Monthly Overpayment MANUAL" for the month of the repayment year you wish to pay the lump sum, eg Oct or potentially calendar year, Jan


You can usually confirm the ERC terms on you mortgage statements, mortgage anniversary or calendar year.

Here's an example of the benefit of overpaying 10% per annum and reducing the term:

BikingBud

For roughly your circumstances and overpaying 10% per calendar year:


Massive potential saving of £109K. Clearly the follow on rate, added as 6.5% will likely vary but with only £38k remaining at the end of the fixed rate term your exposure is limited.

And subject to your funds at that pointyou could seek to pay that off in many fewer years.