Overpaying but monthly interest doesn't seem to reduce?

Jimmar

Something has been bugging me for a while about my mortgage and despite my best efforts I can't work out what is happening. 
I've overpaid my mortgage pretty often over the years (there are no penalties) but my monthly interest never seemed to go down. At first I thought it was because the overpayments were so small compared to the debt that the difference was marginal or that interest rate changes wiped out the difference. 
Today I was considering this again and noticed that this month I was charged £445 interest which is £1 more than I was charged back in November which was three months ago and in those 3 months I've paid in about £5000 (in both regular payments and overpayments) 
The interest rate hasn't changed in this time and my interest is calculated daily so surely between November and now there should have been a discernible difference?
Can anyone help me understand this. 

Hoenir

Being daily interest the period over which the charge is calculated can vary month to month in the shorter term. . 

whitehartal

Did you ak them to use the overpayment to reduce your monthly payments, or to keep the monthly payments the same but reduce your mortgage term?

Jimmar

Monthly payments are always the same, so I would hope it is reducing the term. As for the variation in days in a month I considered this hence the comparison with November  and this month - both payments came after a 31 day month. 

Archerychick

Have you calculated what the interest should be based on the amount of the remaining mortgage? 

Jimmar

Archerychick said:

Have you calculated what the interest should be based on the amount of the remaining mortgage? 

Ah this might be a lead, how do I work it out though? My overpayments are just made on random days where I have some extra money so I don't think I can just do a straight calculation. I don't suppose there's a technique out there that I've missed is there?

Petriix

November has 30 days while January has 31. £444/30 = £14.80 per day (average), £445/31 = £14.35 per day. 

BikingBud

How are you determining your daily interest?
Is your mortgage interest only? If not, not all of your payment will be interest.
Is the interest rate variable? If not there will be a periodic adjustment taken at agreed points during the term of the mortgage ie 2/3/4/5 year fixes.

If no to either of those I would not expect the payment to change.

Also variability with the way differing lenders apply over payments seems to be quite wide, you may wish to investigate and ensure you fully understand how your lender manages overpayments to get best value for money.

Archerychick

Jimmar said:

Archerychick said:

Have you calculated what the interest should be based on the amount of the remaining mortgage? 

Ah this might be a lead, how do I work it out though? My overpayments are just made on random days where I have some extra money so I don't think I can just do a straight calculation. I don't suppose there's a technique out there that I've missed is there?

Without knowing how overpayments are actually being applied it might be difficult. But starter for ten, I would run a spreadsheet that lists out each day of the month, since your last main payment, show the balance of the mortgage by day through the month that deals with your sporadic overpayments, calculates the interest per day, then total up that should be roughly there.

Archerychick

It might be an idea to call your lender and ask them the question, and get them to explain how the overpayments are being applied and why your interest doesn’t appear to be reducing