Is my Mortgage Interest Relief being calculated correctly?

In 2008, my husband I took out a 40 year mortgage for €120,000 (I think) and the interest rate is ECB rate + 1%. For the past year, the rate has been steady.

We qualify based on the date of this mortgage for Mortgage Interest Relief at 30% until 31 December 2017.

I have just looked at our online mortgage statement and it is saying:

Payment: €431.37
Tax relief (77.09)
Direct Debit: €354.28 (this is my mortgage payment)

But... 30% of €431.37 is €129.41 which would make the mortgage payment €301.96, right? Is there something I'm not understanding about this? Is mortgage interest relief capped?

I would appreciate being set straight here so I will know what I'm about if I do indeed need to ring our mortgage company.

Thank you.

Hi, €431.37 is your overall payment. This would include capital + interest. You only get interest relief on the interest portion of your payment, not on the capital part. Hope that makes sense!

As above. If you check your mortgage statement or online you should be able to see the actual amount of interest being charged either monthly or quarterly, this is the amount you multiply by 30%, not the full repayment. Multiplying the full repayment would only work if for some reason he was on an interest only mortgage in which case there would be no capital portion to the repayment every month and only interest. If that were the case the amount owing would not be reducing at all so you will know that as well if you check the account.

Thank you! That makes so much sense

So is this a tracker mortgage?

Not necessarily, a tracker mortgage refers to an interest rate on your mortgage that 'tracks' the ECB (European Central Bank) rate and is always a set margin above the ECB e.g. 1% over ECB so this means at all times no matter what the ECB rate goes up or down to your mortgage would always be 1% more than the ECB rate. The rate only changes when the ECB changes.

If he got the mortgage in 2008 he may have a tracker, they were discontinued by most banks that year but maybe he got in before the end.

A standard variable rate mortgage looks the same on paper (but a higher rate!) as the rate can go up and down but it is not specifically linked to the ECB, the rate changes are at the pleasure of the bank

He who? This is a joint mortgage with my husband. I applied for an arranged it. I pay all of it as I am the sole income earner in my household and always have been.

But yes, it is indeed a tracker, thank you.

Sorry, I read your very first line as 'my husband took out a mortgage', I thought the I stuck in was just a typo!

Apologies, that should have read my husband and I.