Calculator for Split Rates and Overpayments

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aamname

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Hi All,

I am currently trying to ensure that I have all my mortgage calculations correct before buying a house. I've checked all the calculators in the key post and have done extensive googling but I haven't found a calculator that will show me the effect of over-payments on a split rate mortgage. I was just wondering if anyone knows of such a calculator?

I have found overpayment calculators and separate calculators for split rate mortgages, but I'm looking for one calculator which does both.

The example I've been looking at is borrowing €155,000 over 35 years and fixing 80% at 5.9% for 10 years (AIB) with the other 20% variable (AIB's current rate is approx 3.25 I think). This means that initially €31,000 will be variable and €124,000 will be fixed. I am just not 100% sure that I fully understand the interaction of the split rate with overpayments.

From the split rate calculator I found, it seems that after 10 years I would still owe about €26,000 of the portion of the principle/capital which was initially variable. My goal would be to try and clear this amount in the 10 years when the other 80% was fixed. I am now trying to figure out how much I would need to overpay each month to do this. A naive first attempt is €26,000 divided by 10 to get the amount I'd need to overpay per year as €2,600. I could then divide by 12 to get the monthly amount which is €216. However, I know this is not exactly correct and I'm not sure how much it is out by.

Any help / ideas / info or relevant links would be brilliant.

Thanks a million
 
Thanks for the reply Clubman. I just cannot find anywhere on Jeacle's calculator to input a split rate. I've looked in "settings" and the "interest rates" buttons at the bottom.

However, it has occurred to me since I posted that it may be correct to just treat the 20% variable part of the mortgage as a separate variable rate mortgage. So I can input into a Jeacle's calculator the capital as €31,000 with a variable rate of 3.25 as above and change the term to 10 years and it tells me the monthly payment is €302.93 in order to clear that amount in 10 years.

From the split rate calculator I did find online €699 would be the repayment of the fixed part and €124 would be the repayment of the variable (assuming 3.25% variable rate) part during the 10 years I would have the mortgage partially fixed. I now believe that the monthly overpayment I would need to make to clear the variable part in the 10 years would therefore be the difference between between €302.93 and €124. This is €178.93. I'm not sure this is correct, but it seems plausible.
 
Treating it as two separate but concurrent mortgages - one fixed and one variable - sounds like it might work alright. I've asked Karl in case his calculator has some sort of "direct" support for this though.
 
That's great. Thanks a million Clubman. I just always feel better if I can see the results from a calculator or another source agreeing with what I'm expecting from my own calculations. (And I don't want to be kicking myself for not working through all the calculations thoroughly in 5 years time when I realise there's some unintended consequence of splitting the mortgage as I am currently considering.)
 
For what it's worth Karl got back to me with this:
No support for this, I'm afraid. Recently a couple of people have asked about support for mixed mortages in the UK where they are part repayment and part interest-only - I suppose this is the same thing.

I think the poster needs to ask his lender how this would be calculated. It would be interesting to know in case it was worth adding support for it. From reading the thread it looks like there's a lot of guessing going on!
Click to expand...
 
Thanks for that Clubman. I'll talk to my broker (and AIB directly also if I can) next week and I'll update this thread when I have more information - it might be useful for others later on.
 
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