Higher payment for the first month

Dan_Collins_2

Sooler wrote: »

The OP has said completion is 31st January



Is it not the case that lenders only charge interest as you describe because that is the period covered by intitial interest - it is not part of the mortgage - as the mortgage starts the first month after completion.

Complete 31st Jan - mortgage begins the following month - February (1st of 300 monthly payments if it's a 25 year term)

Any interest charged for January is 'initial interest' - interest charged for the amount you've borrowed for however many days you had the money in January.

No you owe the money from the day of completion other wise they would not charge initial interest would they? Imagine your first payment is 2 repayments, I know for a fact this would push the budget of some clients. They cannot set the DD up time to take the payment sooner. NR and a few others allow you to add it to the loan but that has its downfalls.

Dan_Collins_2

Sooler wrote: »

The OP has said completion is 31st January



Is it not the case that lenders only charge interest as you describe because that is the period covered by intitial interest - it is not part of the mortgage - as the mortgage starts the first month after completion.

Complete 31st Jan - mortgage begins the following month - February (1st of 300 monthly payments if it's a 25 year term)

Any interest charged for January is 'initial interest' - interest charged for the amount you've borrowed for however many days you had the money in January.

If you go back I used feb as an example.