Mortgage Balance

[1099]

Hi, Just wondering if anyone can answer this for me because my Building Society apparently cannot.
I have £19.354 left on my mortgage, I'm currently on a fixed rate of 1.74% until 31 July 2026, I pay £475 a month.
I wanted to know what the outstanding balance would be at the end of the fixed rate, I've spoken to the mortgage helpline and been into the branch neither have been able to tell me the answer, I don't really know why because they never really explain why, they just talk about interest being worked out daily.

what have they actually said in response?

Try putting your figures into money saving expert calculator. You can fiddle with the figures to see if it's worth over paying.

Do you have any mortgage statements? It will tell you how much you’ve paid off in a year, and you could work out how much more you’ll pay off before July 26.

You could get a rough figure by looking at how much the mortgage decreases every month on your statement (averaging a long month and a short month) and multiplying by the number of months until July 26. The figure will actually be a little smaller as the interest element will decrease

Very approximately you’re currently paying around £25 interest pcm and the rest of your payment reduces balance. If you make 26 payments til July 2026 you will pay off approx £11700 of capital (26 * £450). As the interest repayments will decrease over the term I’d round that up to £12000. So you’ll owe just over £7000 at the end of the fixed term. If you can save £280 per month you should have enough to redeem the mortgage when the fixed term ends.

You don't need a calculator to see that it's not worth overpaying. You can get far more interest on savings, meaning that if the OP has savings of around £7k, her mortgage is effectively interest free until the end of the fixed rate.

However some mortgage calculators show a graph that should indicate the expected balance at the end of the fixed rate to answer the OPs question.

OP if you enter the balance, remaining total term (not to the end of the fixed rate, but all of it, playing with the numbers, it looks like between 3 and 4 years and in 2 years time you'll owe between £7k and £10k) into the MSE calculator, you will get an answer to your question displayed on the graph.

https://www.moneysavingexpert.com/mortgages/mortgage-rate-calculator/

If interest is calculated daily (which it is for most mortgages), you make your mortgage payment on the last day of the month and £19,354 is the balance today then you will have £8,014.16 balance remaining on 31st July after the July payment is taken

Thanks everyone, I have no idea why the Building Society were unable to answer this question.

I suspect they won't be able to tell you because if your interest is calculated daily, each month you'll be paying a slightly different amount off the capital of the mortgage and a slightly different amount will be interest.

Say your monthly payment £400 is going off the actual mortgage balance and £50 is interest charged, because you have paid £400 off the capital, you are being charged interest on a reduced balance, so your next monthly payment will be £405 off the capital balance and £45 will be interest paid. That probably makes no sense 😁 but we couldn't give an accurate idea of what mortgage balance would be in X months because of the change in interest charged, chance of missed payments and penalties, lump sum overpayments etc

The reason they will not tell you is because all information that is given out has to be absolutely accurate.

In this scenario it is likely that any estimate will be out by a few quid and the potential liability for you making decisions that might not be right in 2 years time is too much of a headache.

On the 31st July 2026 you will have an outstanding balance of £7,057.24 on your mortgage.

I assumed the current remaining amount was on the 1st May 2024 before this month's payment.

Happy to be wrong but that's what my file says.