Need help calculating daily mortgage interest

ACG

silvercar said:

ACG said:

I am not fan of Optima' but I think what they are proposing is correct. Thats how I would calculate it. 
Your free to dispute it and they will have a complaints process but I think you would just be wasting your time. 

What you want basically means they are paying all of your interest for 8 days rather than the extra interest you have been charged. 

OPs argument would be that the mortgage is finishing 8 days later than it would have done had the changeover happened on the correct day. So OP is focusing on the end 8 days of the mortgage, whereas the lender and most people here are focussing on the first 8 days.

eg assuming a 20 year mortgage that should have started on 1 July 2024 but was actually delayed to 9 July 2024. It will now end on 9 July 2044. So OP will be paying Virgin Money for exactly 20 years, so that bit is unchanged. But, due to solicitor admitted error, OP also had to pay Barclays from 1 to 8 July on the higher Barclays rate. 

When the money comes in, overpay the mortgage. 
I do not have the time to work it out but presumably that would resolve the issue or the bulk of it? 

Also in 25-30 years time, due to the effects of inflation 8 days worth will be the equivelent of pennies. I suppose it coud be requested they round it up to £250, that should put it right? 

silvercar

jgreen1986 said:

Thank you all for your helpful replies. My thought process aligned with what Silvercar is describing. I still have the full term of the Virgin mortgage to see out, but paid an additional 8 days of SVR to Barclays. Had the completion happened on time I would not have paid these 8 days so I feel I’m out of pocket by this amount. BikingBud makes a good point about the capital repaid during these 8 days. But I’m unsure how to calculate this. Over the last year I repaid around £4000 of capital through normal payments. This comes to around £11 a day. Would this be the right approach to calculating this? Thanks again!

You realise the capital repaid will lower the amount of the refund? As, if some of those 8 days of £49 included capital that would reduce what the mortgage amount that was transferred to Virgin. I'd be inclined to forget the capital element and consider it a payment for inconvenience. 

I did try to calculate it, but its incredibly difficult. You want the amount of capital in say year 6 of a 25 year repayment mortgage. I did see online calculators that showed graphs of capital dropping where you could deduce the fall in year 6 and then attribute it to days equally. That would yield a result of about £10.40 a day. But, to be honest, it looks like Barclays may have only charged interest. You could ask Barclays, but it is a deduction of the amount, so all it may do is give you some positive feeling if they refuse the extra interest calculation.

Hoenir

silvercar said:

ACG said:

I am not fan of Optima' but I think what they are proposing is correct. Thats how I would calculate it. 
Your free to dispute it and they will have a complaints process but I think you would just be wasting your time. 

What you want basically means they are paying all of your interest for 8 days rather than the extra interest you have been charged. 

OPs argument would be that the mortgage is finishing 8 days later than it would have done had the changeover happened on the correct day. So OP is focusing on the end 8 days of the mortgage, whereas the lender and most people here are focussing on the first 8 days.

eg assuming a 20 year mortgage that should have started on 1 July 2024 but was actually delayed to 9 July 2024. It will now end on 9 July 2044. So OP will be paying Virgin Money for exactly 20 years, so that bit is unchanged. But, due to solicitor admitted error, OP also had to pay Barclays from 1 to 8 July on the higher Barclays rate. 

Will the mortgage end on the 9th July 2044? I suspect not. Mortgage products and terms normally align with the end of the month. Irrespective of whenever they initially complete. Hence why the first months payment is often an anomaly. Then falls into a regular pattern.