Mortgage Principal repayment calculation

Hi,

Looking for some guidance on how this repayment is calculated as I have a small difference to what I am paying each month in principle to what various repayment calculators say.

I have used numerous mortgage repayment calculators including my lenders and the one in the key posts on this site and they all say my repayment is €1,207.33 but I am charged €1,208.82.

100K over 96 months @3.75%, property value 500K. No missed payment, no arrears or additional products with lender.

I have asked for breakdown of how my payment is calculated but not received anything back yet.

What am I missing, I know its a small difference but anyone have any suggestions why it would be different ?

Back when I had a mortgage, I used to keep a very detailed spreadsheet (as is my want!) and was able to calculate monthly payments to the cent. Interest is generally charged per day rather than per month and this may well be why there is a small discrepancy in the calculations.

Jackuu said:

100K over 96 months @3.75%, property value 500K.

Click to expand...

What was the original loan amount and term?
Maybe starting now (in the middle of the own term?) with the remaining loan amount and term isn't going to give you the correct result?

ClubMan said:

What was the original loan amount and term?

Click to expand...

Original loan amount was the €100K over 96 months and rate has been 3.75% since drawdown.

Jackuu said:

€1,207.33 but I am charged €1,208.82.

Click to expand...

That is pretty accurate. You could drive yourself mad trying to resolve this.

I presume that the banks use the number of days rather than months, but I don't know.

The most critical thing to check is the calculation of interest. It doesn't matter if your overpayment is wrong. You just end up paying the mortgage off a bit sooner or a bit later.

@Jackuu , the most likely explanation is the timing of the drawdown vs the first payment month.

Very roughly, €100k @3.75% is €10.27 per day interest.

A payment of €1208.82 is equivalent to an initial principal of €100,126 @ 3.75% or roughly an additional 12 days of interest

So if you drew down in January but missed the payment cycle, then those 12 days of interest get added to the initial principal. So your first month would be February based on the initial drawdown plus interest from January hence the slightly higher payment

_OkGo_ said:

@Jackuu , the most likely explanation is the timing of the drawdown vs the first payment month.

Very roughly, €100k @3.75% is €10.27 per day interest.

A payment of €1208.82 is equivalent to an initial principal of €100,126 @ 3.75% or roughly an additional 12 days of interest

So if you drew down in January but missed the payment cycle, then those 12 days of interest get added to the initial principal. So your first month would be February based on the initial drawdown plus interest from January hence the slightly higher payment

Click to expand...

Thanks, that was the reason. Drew down on the 19th of the month and first payment was 07th following month so the interest was added to principle.