Does this financially ring true?

[ManyBooksLittleTime]

We bought our house nearly 20 years ago for 245k. Now, 19 years later, we still have 203k left on the mortgage. I know the first years is basically paying interest , but only 42k in 19 years??? We have had good interest rates too.Also, my husband reckons it will go down to 181k by August next year. Please can soneone more astute with finance let me know if these numbers can be right?

Wow sometimes I wonder why I come here and try and help some people when there are so many toxic people on here.

Yes everyone is entitled to there view and it’s a public board but does the old saying if you’ve got nothing good to say don't say anything not apply.

I understand this site may have a bias of very feminine opinions but not every woman is a radical feminist or misandrist.

Give the OP a break and stop projecting

From what I have read to put it gently @ManyBooksLittleTime you have been naïve. I deal with the finances in my marriage - bills, all incomings and outgoings and the two times we booked a new fixed rate for our mortgage (once increasing by £10k) the mortgage specialist ensured DH and I knew exactly what was happening, OP if your DH has managed to increase the borrowing in your name without your knowledge you should complain to the lender and if necessary contact the FSA regarding whoever arranged your mortgage as they’re as culpable as your DH appears to be.

It is one thing to let a partner sort out the financial stuff, eg paying of bills and hunting down best deals but when you are signing a legal document you MUST pay attention. You could be signing anything and it is down to the individual to understand that document and its implications. The basic information the OP needed each time was how much per month, what rate, how long for (to pay it off). That is the absolute minimum and she doesn't even know that.

Short answer is, no - these numbers do not ring true. The amount of debt you should have to repay right now is a function of: 1) the term of your mortgage (25 years is standard), 2) the interest rate, 3) whether you have a repayment or interest-only mortgage. If you took out a £245K 25-year mortgage 20 years ago and paid a 4% interest rate over that 20 year period (which isn't an unreasonable assumption for the average mortgage rate over this period), then you should have around £70K of debt to repay right now.

Either you have taken out a lot more borrowing or have had a crazy high interest rate or have an interest-only mortgage if you still have a £203K balance to pay.

The good news is, your payments of £2.4K a month should clear the balance within 8 years, but that assumes you pay an interest rate of around 4%. If your interest rate is higher, your monthly repayments will need to go up too to clear the balance.

It sounds like you have a great interest rate now (of 1%), so I would overpay as much as you can before this favourable interest rate ends.

I hope this helps you when discussing this with your DH.

@Clovacloud I’ve got one of those mortgages and it’s saved us thousands! We paid off our mortgage years early. It was called an offset mortgage or Australian style mortgage 20 years ago. They now pay us interest on our credit balance.

so used in the “right” way, it was a good product, but can understand it might have been tempting to just dip into the equity whenever. I could write myself a cheque for £150k tomorrow if I wanted! Which is a bit mad now that I think about it!

also for reference. We paid £315k for a 3 bedroom detached doer upper in Scotland in 2003! So plenty places outwith London commanding these prices it seems.

@skeemee you are a good and disciplined person 😀 My parents on the other hand once put a luxury car on a credit card…they were not the kind of people who should have gone anywhere near that kind of product!

I know what you mean about house prices in the early 2000s, we bought a regular 3 bed semi in East Anglia for 180k in 2003. I think 200k was a fairly normal price for those days.

In answer to your original question it really depends how much (if any) repayments have been made. Hopefully it's all innocent, but are you sure it's being paid off and/or any other borrowing etc. Need to get on top of this!

All sounds a bit fishy to me. I have a 190k mortgage with 2.17 interest rate and I pay £850 a month repayment. You shod have next to nothing left after all that time even with extra borrowing.

Glad you’re getting the figures op. This is too late for you and I’m sure you know this now but just in case anyone is considering this:

Do not turn unsecured lending into secured lending by using a mortgage to pay off credit cards. It puts you into a really vulnerable position.

If you don’t pay your credit card not a lot happens other than you trashing your credit history. Unsecured lenders can’t force you to sell your house.

Secured lending is another ball game, they have your home as security and they will repossess once you’re off the ladder it is very difficult to get back on.

Ffs - she meant ‘bit’ How much is a ‘bit’ more - very relevant!

So we have just remortgaged & borrowed extra on top for windows & roof repair…. The term of our mortgage has reduced slightly so it’s 25years now instead of about 32 (which is what our old one would have been) our payments are the same as before & when the 25yrs are up we would have repaid it all

my point being, even if you’ve borrowed extra, providing you’ve not gone to interest only the balance would be settled at the end of the term - otherwise the money isn’t accounted for

sounds like you’ve gone to interest only maybe 😬

My mortgage statement has never been electronically delivered. Always a hard copy, whatever provider I have had.

I'm really hoping that this is not terrible news on a large amount you didn't know about. 😞 my ex husband did a similar thing and after the divorce I was left with very little as the debts were in both names

It doesn't feel right to me.

Our current home we had a mortgage of £151,000 in Dec 2016z we currently owe £124,000. We are not over paying to bring it down. So 6 years we have paid off £27,000.

Our last house we bought for £46,500 in 2003, in 2005 we remortgaged (stupidly) taking it up to I think £70. We sold it in 2016 and owed £34,000. So in 11 years we paid off £26,000.

This definitely isn't right unless your husband has been taking out larger amounts when remortgaging or you were on interest only for a while!

In comparison our mortgage has reduced by 60k in 8 years with 1 lump sum payment of 10k in that time so 50k. Interest rate of 3.8% for first 4 years, 1.2% after that.

Sounds to me like you've inadvertently switched to an interest only mortgage, and not fully understood what that meant financially.

If you kept upping your borrowing when you remortgaged then you're not paying off a 245k mortgage anymore. What's the actual amount? None of the numbers you've given add up. This is incredibly important and you and your OH need to sit down and go through everything together. The fact that you haven't seen any statments is ringing big alarm bells for me. You usually get them once or twice a year.

Sorry you're finding this out now. The low interest rates over the past 20 years makes me think you should've paid most of it by now. We've got less than ten grand left to pay on ours after twenty years.

I would guess you’ve been interest only or potentially you’ve been on an endowment mortgage. Would explain why your DP says a big lump sum will come off at some point, endowment matures?

Yes....scarey isnt it.? dont worry....the actual capital amount begins to get smaller in the last few years. Right now...its mainly interest.

@Solonge

Have you read the thread?

I have this sinking feeling you've signed paperwork not understanding it and he's actually taken huge amounts of extra debt on the mortgage and blown it all.

If you have been borrowing more when you remortgage the. you have cleared down more than £42k capital as you have been borrowing more money.

are you on a fixed interest rate, if so when does it finish, I don’t think you are paying enough to clear the mortgage on 8 years, UNLESS you are on a very low fixed rate for the rest of the term.

call you mortgage provider and ask them how much was borrowed, and also what they think you need to pay to clear the mortgage in 8 years.

nomdegrrr1 We had a mortgage in the late 1980s like that. My, now deceased, husband was borrowing money from it behind my back. I have no idea on what he spent it. It was a sorry tale and I don't want to frighten ManyBooksLittleTime ·with my story, but please, do check on what is happening and find out about what was borrowed each time you switched Provider. Then follow the mortgage account monthly and make sure no more is borrowed against the house unless it is used to improve the value of the house.

Op this sounds awful! You need to look at the statements! I have a 380k mortgage have overpaid by only £150 a month from the start and we’ve paid 50k off in 3 years! Our interest rate is 1.92 and we haven’t borrowed more!