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  • FIRST POST
    • d4rr3n
    • By d4rr3n 13th Jun 19, 10:48 PM
    • 33Posts
    • 1Thanks
    d4rr3n
    Gut feeling I paid off my mortgage but I am still paying!
    • #1
    • 13th Jun 19, 10:48 PM
    Gut feeling I paid off my mortgage but I am still paying! 13th Jun 19 at 10:48 PM
    Purchased a house back in the winter of 2001 and been with the same small bank ever since making monthly payments.

    The original mortgage was for a period of 20 years. I obviously have been paying it off at a much more rapid rate since the rates have dropped.

    I have a gut feeling I have paid off my mortgage by a significant amount.

    I know others who are members of this small bank (has perhaps four branches in the UK) and they are not known for being honest!

    I need to get a professional to look into this and do the maths. Any suggestions?

    I searched mortgage investigator but all I could find was fraud on the side of the customer not on the side of the bank.
    Last edited by d4rr3n; 13-06-2019 at 10:54 PM.
Page 1
    • antrobus
    • By antrobus 13th Jun 19, 11:51 PM
    • 16,875 Posts
    • 23,871 Thanks
    antrobus
    • #2
    • 13th Jun 19, 11:51 PM
    • #2
    • 13th Jun 19, 11:51 PM
    Purchased a house back in the winter of 2001 and been with the same small bank ever since making monthly payments.

    The original mortgage was for a period of 20 years. I obviously have been paying it off at a much more rapid rate since the rates have dropped..,,,
    Originally posted by d4rr3n
    You have made additional capital repayments?

    I have a gut feeling I have paid off my mortgage by a significant amount

    I know others who are members of this small bank (has perhaps four branches in the UK) and they are not known for being honest!

    I need to get a professional to look into this and do the maths. Any suggestions?

    I searched mortgage investigator but all I could find was fraud on the side of the customer not on the side of the bank.
    Originally posted by d4rr3n
    What are the numbers on your latest annual mortgage statement?
    • warby68
    • By warby68 14th Jun 19, 5:14 AM
    • 1,362 Posts
    • 10,875 Thanks
    warby68
    • #3
    • 14th Jun 19, 5:14 AM
    • #3
    • 14th Jun 19, 5:14 AM
    What do your statements say?
    • getmore4less
    • By getmore4less 14th Jun 19, 5:23 AM
    • 37,403 Posts
    • 23,082 Thanks
    getmore4less
    • #4
    • 14th Jun 19, 5:23 AM
    • #4
    • 14th Jun 19, 5:23 AM
    Its not that hard to work out with some numbers.

    Put up the numbers for the original mortgage and the last statement.

    START: Date, Amount, Rate, Term, Payment.
    LAST statement : Amount outstanding start and end, total interest, payments, rate.


    That will get someone started it might be enough to get close and see if more info is needed for the interim years

    That will be all the annual statements.

    If that does not tot up close to the right amount then more detail will be required like each change of rate and payment.


    it could be something as simple as you are interest only and have not paid any of the mortgage off.
    • Edi81
    • By Edi81 14th Jun 19, 6:05 AM
    • 732 Posts
    • 690 Thanks
    Edi81
    • #5
    • 14th Jun 19, 6:05 AM
    • #5
    • 14th Jun 19, 6:05 AM
    In 2013 the OP was with Allied Irish Bank and was querying PPI.

    I’d find it hard to believe that you could still be paying a mortgage and it being repaid.

    As others have said you should be getting annual statements.
    • BoGoF
    • By BoGoF 14th Jun 19, 6:23 AM
    • 5,299 Posts
    • 5,166 Thanks
    BoGoF
    • #6
    • 14th Jun 19, 6:23 AM
    • #6
    • 14th Jun 19, 6:23 AM
    OP - regardless of any BOE base rate drop your 20 year mortgage will still take you 20 years to pay off unless you paid more than your contractual monthly payment.
    • AnotherJoe
    • By AnotherJoe 14th Jun 19, 8:03 AM
    • 15,967 Posts
    • 19,173 Thanks
    AnotherJoe
    • #7
    • 14th Jun 19, 8:03 AM
    • #7
    • 14th Jun 19, 8:03 AM
    Purchased a house back in the winter of 2001 and been with the same small bank ever since making monthly payments.

    The original mortgage was for a period of 20 years. I obviously have been paying it off at a much more rapid rate since the rates have dropped.

    Why is that "obvious"? Did your payments drop when rates dropped? Did your rate drop? There was soemone on here a few weeks ago who, through inaction, stayed on SVR for years after the initial fixed rate period stopped.

    I have a gut feeling I have paid off my mortgage by a significant amount.

    Of course you have, you've only got two years to go (assuming you are on repayment mortgage which i hope otherwise youve got a big shock coming)! Why dont you have actual numbers? I have a gut feeling you have either gone along with lowered monthly payments and so the term has stayed the same or even worse, you've moved onto SVR and the repayments have remained roughly similar since SVRs have fallen since you started, and the term still the same. Someone who relies on "gut feel" to understand their mortgage payments is likely to make one of these two mistakes.

    I know others who are members of this small bank (has perhaps four branches in the UK) and they are not known for being honest!

    I need to get a professional to look into this and do the maths. Any suggestions?

    Why do you need a "professional"? Its simple maths.

    I searched mortgage investigator but all I could find was fraud on the side of the customer not on the side of the bank.
    Originally posted by d4rr3n

    What rate are you currently on and what is your monthly repayment?
    Last edited by AnotherJoe; 14-06-2019 at 8:07 AM.
    Please dont criticise my spelling. It's excellent. Its my typing that's bad.
    • getmore4less
    • By getmore4less 14th Jun 19, 8:21 AM
    • 37,403 Posts
    • 23,082 Thanks
    getmore4less
    • #8
    • 14th Jun 19, 8:21 AM
    • #8
    • 14th Jun 19, 8:21 AM
    In a previous thread the OP says,

    My property was let so I dont believe I ever required PPI as the rent fully covers mortgage payments

    Wonder if it the same one and was interest only?
    • tacpot12
    • By tacpot12 14th Jun 19, 8:38 AM
    • 2,899 Posts
    • 2,623 Thanks
    tacpot12
    • #9
    • 14th Jun 19, 8:38 AM
    • #9
    • 14th Jun 19, 8:38 AM
    You will find it difficult to find an expert to review the calculation. Most banks don't even know who their expert is in this field; mainly because the calculations are all done by computer systems developed years ago so the algorithm's designers are no longer around. Testing at the time the system was implemented proved the algorithm was correct. Only data entry errors can cause it to produce the wrong answer.

    Ultimately, if you want to challenge this, you will have to find an expert that a court would accept. But in the meantime any IFA or accountant should be able to do the calculation. I would first assemble all the data showing your repayments, capital borrowed and interest rate changes.
    The comments I post are my personal opinion. While I try to check everything is correct before posting, I can and do make mistakes, so always check official information sources before relying on my posts.
    • d4rr3n
    • By d4rr3n 14th Jun 19, 11:07 AM
    • 33 Posts
    • 1 Thanks
    d4rr3n
    Thanks everyone, I cant put all the details here but the basics should be enough to get an idea if there is an overpayment.

    I purchased a house for 470k in winter of 2001, got a 100% mortgage (those were the days) for 470k. First draw down to commence Feb 2002 of 3,564 per month. Term 20 years variable repayment mortgage @ 2% above base rate (which was 4.75% when this mortgage commenced).

    Every month I paid 3564 up until June 08 when my monthly payments were reduced to 3359 per month. The interest remained the same 2% above bank base rate (which was 5% in 2008).

    Up until now I have been paying 3359 per month. Even though the bank base rate dropped over the years my monthly repayment remained the same.

    I currently owe 27k outstanding according to my mortgage account

    What I cant understand is since the base rate dropped significantly over the years (yet my repayments remained the same) I have obviously been paying off the mortgage at a much faster rate so you would expect the term of the mortgage to be significantly reduced ?
    Last edited by d4rr3n; 14-06-2019 at 11:23 AM.
    • seashore22
    • By seashore22 14th Jun 19, 11:17 AM
    • 1,308 Posts
    • 3,063 Thanks
    seashore22
    Thanks everyone, I cant put all the details here but the basics should be enough to get an idea if there is an overpayment.

    I purchased a house for 470k in winter of 2001, got a 100% mortgage (those were the days) for 470k. First draw down to commence Feb 2002 of 3,564 per month. Term 20 years variable repayment mortgage @ 2% above base rate (which was 4.75% when this mortgage commenced).

    Every month I paid 3564 up until June 08 when my monthly payments were reduced to 3359 per month. The interest remained the same 2% above bank base rate (which was 5% in 2008).

    Up until now I have been paying 3359 per month. Even though the bank base rate dropped over the years my monthly repayment remained the same.

    I currently owe 27k outstanding according to my mortgage account
    Originally posted by d4rr3n
    If you owe £27,000 it's not paid off, is it?

    I have to say that relying on gut feeling is an odd approach to finance. Only cold hard facts will do.
    • d4rr3n
    • By d4rr3n 14th Jun 19, 11:27 AM
    • 33 Posts
    • 1 Thanks
    d4rr3n
    If you owe £27,000 it's not paid off, is it?

    I have to say that relying on gut feeling is an odd approach to finance. Only cold hard facts will do.
    Originally posted by seashore22
    Obviously not, yet I think it should be considering I have been paying it off at a faster rate (my monthly repayment has remained the same since 2008) so not completely gut!
    • Thrugelmir
    • By Thrugelmir 14th Jun 19, 11:31 AM
    • 64,860 Posts
    • 57,226 Thanks
    Thrugelmir
    What I cant understand is since the base rate dropped significantly over the years (yet my repayments remained the same) I have obviously been paying off the mortgage at a much faster rate so you would expect the term of the mortgage to be significantly reduced ?
    Originally posted by d4rr3n
    Your mortgage term is due to end in late 2021. In around 10 months your mortgage will be cleared at current repayment levels. Would appear that you've reduced the term by at least 18 months. Not at all bad.
    “If the financial system has a defect, it is that it reflects and magnifies what we human beings are like. Money amplifies our tendency to overreact, to swing from exuberance when things are going well to deep depression when they go wrong. Booms and busts are products, at root, of our emotional volatility.”
    ― Niall Ferguson
    • Takmon
    • By Takmon 14th Jun 19, 11:33 AM
    • 830 Posts
    • 833 Thanks
    Takmon
    Obviously not, yet I think it should be considering I have been paying it off at a faster rate (my monthly repayment has remained the same since 2008) so not completely gut!
    Originally posted by d4rr3n
    Have a look at how the UK base rate has moved over the years you have had your mortgage.

    In 2008 the base rate dropped significantly which was when your monthly payment decreased. Since then has it remained at a low level so it makes sense your payments have remained the same.

    I can't see how you think you have been paying it off at a faster rate when your monthly payment has remained the same since 2008?
    • seashore22
    • By seashore22 14th Jun 19, 11:33 AM
    • 1,308 Posts
    • 3,063 Thanks
    seashore22
    But they've been sending you statements, so it's easy to check the progress of your mortgage.

    Are you saying that you think a mistake has been made? If so check the statements and see what they have to say. The figures should be there for you to look at.

    Have you received letters to say that the interest rate has dropped since 2008? I assume not.

    I think you can opt to keep the repayments at the same rate if the interest rate drops, therefore paying more off your mortgage. It doesn't sound like you've done that.
    Last edited by seashore22; 14-06-2019 at 11:36 AM.
    • d4rr3n
    • By d4rr3n 14th Jun 19, 12:54 PM
    • 33 Posts
    • 1 Thanks
    d4rr3n

    In 2008 the base rate dropped significantly which was when your monthly payment decreased. Since then has it remained at a low level so it makes sense your payments have remained the same.
    Originally posted by Takmon
    The reduction of repayment in 2008 had nothing to do with a change in bank base rate. It was because I was struggling to make the large payments so they agreed to drop it slightly.

    Bank base rates currently are 0.5 as of 2009, in Feb 2008 my mortgage review says they are currently 5% but the table below says 2%. Anyway my repayments of 3359 has been the same since 2008 so big difference between 5% and 0.5% as of 2009, hence my reason for thinking a significant reduction in term of mortgage.


    UK Bank base rates

    2001 4%
    2002 4%
    2003 3.75%
    2004 4.75%
    2005 4.5%
    2006 5%
    2007 5.5%
    2008 2%
    2009 0.5%

    When my mortgage started in 2002 my bank says its base rate is 4.75 Bank of England says 4. In 2008 my bank says its 5 Bank of England says its 2.
    Last edited by d4rr3n; 14-06-2019 at 1:25 PM.
    • zx81
    • By zx81 14th Jun 19, 1:01 PM
    • 23,834 Posts
    • 26,500 Thanks
    zx81
    There's going to be some significant accrued interest from when you reduced the payments below the contractual ones.

    What sort of mortgage was it? You said it was variable, but you also mention the base rate which suggests it was a tracker. What was it and what is it now?
    • seashore22
    • By seashore22 14th Jun 19, 1:04 PM
    • 1,308 Posts
    • 3,063 Thanks
    seashore22
    The reduction of repayment in 2008 had nothing to do with a change in bank base rate. It was because I was struggling to make the large payments so they agreed to drop it slightly.

    Bank base rates currently are 0.5 as of 2009, in Feb 2008 my mortgage review says they are currently 5% but the table below says 2%. Anyway my repayments of 3359 has been the same since 2008 so big difference between 5% and 0.5% as of 2009, hence my reason for thinking a significant reduction in term of mortgage.


    UK Bank base rates

    2001 4%
    2002 4%
    2003 3.75%
    2004 4.75%
    2005 4.5%
    2006 5%
    2007 5.5%
    2008 2%
    2009 0.5%
    Originally posted by d4rr3n
    I'm confused. If you paid less than was agreed when you took the mortgage out, why do you think it should have been paid off early?
    • getmore4less
    • By getmore4less 14th Jun 19, 1:23 PM
    • 37,403 Posts
    • 23,082 Thanks
    getmore4less
    Thanks everyone, I cant put all the details here but the basics should be enough to get an idea if there is an overpayment.

    I purchased a house for 470k in winter of 2001, got a 100% mortgage (those were the days) for 470k. First draw down to commence Feb 2002 of 3,564 per month. Term 20 years variable repayment mortgage @ 2% above base rate (which was 4.75% when this mortgage commenced).

    20years
    £470k 0% ~£2kpm
    £470k 4.75% £3040pm
    I guest you mean
    £470k 6.75% £3570pm
    Feb O2 base rate was 4% not 4.75 (changed Nov 01)
    £470k 6% £3,370




    Every month I paid 3564 up until June 08 when my monthly payments were reduced to 3359 per month. The interest remained the same 2% above bank base rate (which was 5% in 2008).


    Up until now I have been paying 3359 per month. Even though the bank base rate dropped over the years my monthly repayment remained the same.

    I currently owe 27k outstanding according to my mortgage account

    What I cant understand is since the base rate dropped significantly over the years (yet my repayments remained the same) I have obviously been paying off the mortgage at a much faster rate so you would expect the term of the mortgage to be significantly reduced ?
    Originally posted by d4rr3n
    need more details because something looks wrong at the start

    more accurate base rate changes
    https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp
    • d4rr3n
    • By d4rr3n 14th Jun 19, 1:31 PM
    • 33 Posts
    • 1 Thanks
    d4rr3n
    I'm confused. If you paid less than was agreed when you took the mortgage out, why do you think it should have been paid off early?
    Originally posted by seashore22
    Because I am paying off at 2% above base rate. In 2002 base rate according to my bank was 5%. Bank of England base rate is now only 0.5. So my 20yr mortgage was calculated as paying off at a rate of 2% above a base of 5. So I am paying it off at a faster rate then originally calculated back in 2001.

    I pay off 205 less per month then original mortgage.
    Last edited by d4rr3n; 14-06-2019 at 1:33 PM.
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