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?

Sorry OP, I don't fully understand how all the interest works (and thats fine as I don't have a mortgage!)... but even I can see how fishy this all looks.

I'd not accept his maths, on paper or otherwise. I would want to see the actual hard evidence from the mortgage co's and details of each change to what you originally had.

He's done something significant without your consent and he is still trying to bamboozle you.

My mortgage is £390 and has 25 years left to pay off at a rate of 1.99% and £1600 a month. Your husband has stolen a significant amount of money and there’s no way in hell that will be paid off in 8 years at £2k per month

Your mortgage will likely not be paid off in 8 years, you are barely factoring in interest. If you are remortgaging next august your rate will be significantly higher than your current rate.
And you don’t state what your actual repayment is compared to 1.9k and now 2.4k. Can you even increase your monthly payment to that without incurring a fee?

He’s taking shite. How can he ‘show you the figures?’
The interest rate is irrelevant in a way, your repayment considers your interest rate, the total loan and the length of the loan so you should be well under 200k with only 8 years “left”.
A large sum, possibly several times, has been added to your mortgage.
The term may also have been lengthened.
This is all quite important and needs to be dealt with immediately as you have a huge amount left to pay of your mortgage given you bought 20 years ago.

All he will do is write down stuff he knows you dont get to keep you in the dark.

DO NOT TRUST HIM

I dont even know why I am wasting my fingers typing this because you will anyway.....

You need to get copies of the mortgage statements going back the full history of the loan.

But your husband is lying out his arse. At some point he has added a significant amount onto the loan and not told you.

No your DH isn’t explaining or understanding it correctly… you bought the house for 245K and financed that amount at 4% interest (compound). That 365K does not come into the equation at all. (Unless you borrowed an additional 120K)

I’ve seen things on the internet where people are trying to do mental gymnastics to make the rising interest rates into a good thing…but it’s all crap. That 365K looks really familiar so maybe he got that from some bad information floating around?

Please go find a mortgage calculator and plug in your numbers and find out what you added to the original loan amount. Also look into compound interest and how it differs from simple interest.

I really say this in the most helpful way possible and not snarky at all. We’ve all made bad financial decisions (OMG, have I made some doozies), the smart ones learn from them.

When an explanation is that confusing it’s either because the explainer doesn’t understand the situation themselves or because they are deliberately trying to obfuscate the truth. I honestly don’t know which would be worse in this situation.

Is he trying to say the mortgage was interest only all along? I still don’t think those figures add up.

Dont let him try and baffle you with what he thinks OP, look at all the statements yourself.

I’m sure even if you’ve moved mortgage companies the previous ones will send you copies of their records if you contact them.

And I’d also get your house valued, so you know where you stand if you were to sell up.

Given what you paid for your home all those years ago, I expect it's quite sizeable and worth several millions now.
The running costs, ie heating, council tax ,insurance must be sky high.
Do you think you DH isn't particularly money savvy and been rather naive about the true cost of living?
Not every high earning educated person has a grip on personal finances, we're not all geniuses in every field.
The high flyers/ earners often lack common sense and just dont get the obvious.
I am guessing he called the mortgage broker/ provider and presented them with the cashflow situation and of course they would suggest they loan the additional funds for whatever debt.
However. ...there is an issue with the fact you were not asked to agree to this transaction .... Do you think your DH is a trusting soul?

Don't let him "explain the figures to you" on paper. He will try to make it sound like what he's done is legit and can falsify amounts etc, making it look like you're the one who just doesn't get it. I would get all the figures and statements directly from the bank and mortgage provider - take them to a financial advisor or someone in your family/friends who you can trust and is good with finances and see if they can help you with it. Or even post on here with the private info blanked out. There are lots of people on here who can help - just don't let your DH convince you it's all ok. You will not be paying that off in 8 years.

Looking at how it's laid out by the company though it's like this.

203 over 8 years at 5.11 interest is 253k to pay back in total.

We are not doing this and the company have advised not to switch mortgage provider, but to see how things pan out.

That figure would be horrific. But we do pay back so much more than we borrow.

Looking to get to the bottom of it all tomorrow.
And my house isn't worth anywhere near 1 Mill unfortunately

You need to go and see the bank by yourself. Make an appointment and do not take your husband. They have specialist teams to help you if your own husband has misled you.

Thank you so much for taking the time to do this. I'll be printing it out for tomorrow

If you have been releasing equity/increasing the size of the mortgage there will be correspondence relating to that.
If you have switched to interest only, at the very least you should be paying into a life insurance policy or have some other agreement with the lender as to how you are going to pay the full amount at the end of the term.
Has your husband made some sort of arrangement with the lender?
You had better get all the paperwork out and check.

*Looking at how it's laid out by the company though it's like this.

203 over 8 years at 5.11 interest is 253k to pay back in total.*

What company?
To pay 203k off on a 5.11% interest mortgage you would need to pay £2,581 per month, excluding remortgage fees.

Looking to get to the bottom of it all tomorrow.
But you know what the answer, you already admitted you have borrowed extra multiple times when you remortgaged. So the question is how much, what did that money go on, and why do you have such little knowledge on your own loan?
You know extra money was borrowed so your husband hasn’t done it fully behind your back.

OP, are there any organizations that can help explain all of this to you when you get all of the statements? I’m not in the UK, so I don’t know of any local orgs, but in my country there are different groups that offer classes for financial matters such as understanding mortgages and financing, Before you make any decisions you really need to arm yourself with solid knowledge.

I really would try to get to the bottom of this yourself. The discrepancy is huge and I would want to understand for myself why you are so far from where you should be at this stage.
Don't let anyone blind you with numbers - mortgages are a simple concept. You start off with the amount you borrow and the lender works out the total amount of interest due over the life of the mortgage at the original rate then calculates how much you need to pay each month to get to zero at the end of the term. If interest rates go up from the original rate -your monthly payments go up (or you have to push out the end date) and if interest rates go down from your original rate - you pay less each month or you end up paying off the mortgage sooner.

What you need to know is
Original amount borrowed + original interest rate + term
What amounts were added to the mortgage and when?
Did you agree to that additional borrowing?
Have monthly payments been made in full in accordance with the agreed repayment schedule?
Was the mortgage always a capital reduction mortgage or did it go interest only at any point?
Have any payment holidays been taken?
Are the mortgage payments up to date now?

As Xenia pointed out up thread - if there additional borrowing that you haven't agreed to then this is serious and you should be raising it with your lender (not with your DH).

Either your DH added to the debt or he didn't pay the debt (interest only or mortgage holiday)

Also surely you must have switched mortgage provider over 20 years. I understand that a lot of people dont switch every two years but you must have moved your mortgage onto lower rates over that time?

I think the million pound house was in response to me. However, I think your house would have to be 1mil by now if it was 240 in 2002. I mean i just checked local houses here in London and any house that cost that much back in 2002 is worth at least 850k right now. And where other than London would you have bought a house for 245k back in 2002. That was a lot of money back then - that got you a nice three bed house in what is now considered to be very desirable parts of SW and North London.

I bought a £267k house in 2004. Not London. 3 bed detached. It’s worth less than £500k now, maybe £450k. London prices increased at an exceptional rate.

Sadly, this could be right.

That happened to a client of mine a few years ago.

He'd remortgaged several times without her consent, and when we got a copy of the forms from the last mortgage, the signature was nothing like hers.

I changed jobs before it was resolved, so never found out what happened about it.

On top of this, why has he lied to you? Gambler? Affair?

Given what you paid for your home all those years ago, I expect it's quite sizeable and worth several millions now

millions? I bought my house around the same time, it’s gone from 88 to 200.

OP I think your husband has some explaining to do

It's clear he either doesn't understand mortgages himself or is trying to make sure you don't.

You bought the house for a certain amount.
Mortgage was £245k
There must have been a cash deposit as mortgage isn't for 100% of cost of house, it would have been 95% max, or 90% or less.

You pay off the mortgage, the money borrowed from the bank. So that at the end of the term you owe the bank £0 and the whole house is yours.

The mortgage payments each month pay off interest and some of the capital (the mortgage money you borrowed). At the start of when you borrowed, say it would be something like 98% interest and 2% capital. Your monthly payments will stay the same but the proportion that goes to pay off interest and proportion that pays off capital will change.

By the end of 15 years your payments (assuming no extra money is borrowed) will be maybe 70% interest and 30% capital, so the longer you have the mortgage the more capital you pay off each month, so that by the end of the term, your last few payments are nearly all just chunks off the capital.

What your husband has said makes no sense.

Plus the capital, the amount you owe the bank, should have reduced a lot more. If you've only got 8 years left of the mortgage you should have a significant amount less owing.

Anyway. Get the facts from the paperwork, not your husband.