Mortgage Payment By Direct Debit notice lenders taking dd out 2 to 3 days before due

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ballaboy

Registered User
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I have analysed my mortgage payments recently and notice lenders taking dd out 2 to 3 days before due date,eg this months due out on 5th, taken out on 2nd,going by this it would be about 30 days in a year they are cutting me,that would be a full months interest,which would be taken from me,is this a stroke
 
Re: Mortgage Payment By Direct Debit

If they're crediting it against the mortgage principal immediately you shouldn't be losing out provided that the interest rate on your mortgage is higher than the rate on the source account. They should be taking it out in a predictable manner though so that you can budget for it.
 
Re: Mortgage Payment By Direct Debit

Mine gets taken out on the 3rd of the month but if the 3rd falls on a Saturday or Sunday/bank holiday they take it out the previous working day. This seems like sharp practice as they could simply wait until the next working day.
 
Re: Mortgage Payment By Direct Debit

OP, can you clarify exactly what you are saying here.

My reading of the situation is that by taking the money early, the bank is getting a months interest on one months payment over the entire year. So if your monthly payment is for example €2000, then over a year, at a deposit rate of 5%, after DIRT you lost approx €6?
 
Re: Mortgage Payment By Direct Debit

If my interest on my mortgage is 1600 per month and they take it out 3 days per month sooner than agreed date,they are benefiting by a months interest for money i didnt have use of,so a nett gain for mortgage company of 1600 per annum
 
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