Mortgages--How much do you actually end up paying back?

A

Astro_man

Registered User
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I have a simple question (i think).
But nobody seems to be give me a straight forward awnser...

If i get a mortgage of say...250,000 EURO
The Interest rate is fixed at 4.5%
The term of the load is over 20 years

How much do you actually end up paying back after the mortgage is repaid?

Please..oh please show calculations for a confused boy :confused:
Any help would be appreciated
 
You probably don't really want to know!!!

Based on those figures and using a mortgage business calculator I have access to (used in one of the banks) your grand total paid back is : 379,589.63
 
At those rates the repayment would be 1581.62 a month = 379590 over 20 years.
BUT - I doubt if you will get 4.5% fixed for 20 years off anyone - so the figures are fairly meaningless really.
 
Thank you for all of your replies. Yea, i know my information was very unrealistic...but i just wanted to keep it extremly simple..... just to get a feel of what you actually end up paying back. Unfortunately i cannot view the calculators you have linked me to. I would ideally love to see this worked out on paper. Perhaps i'll find it on the net ;)
 
Astro_man said:
Unfortunately i cannot view the calculators you have linked me to. I would ideally love to see this worked out on paper. Perhaps i'll find it on the net ;)
Click to expand...
If you you'll find lots of other calcs out there which might/should work for you.
 
Thank you Satanta.
I just tried this link...
http://www.itsyourmoney.ie/index.jsp?pID=118&nID=298

It tells me that for a mortgage of €250,000
At 4.5% interest
Over 30 years
That the monthly repayment is €1,253
Cost of credit €201,204

Am i correct in saying that the overall sum paid back over the duration of the mortgage is....(€1253 x 12) x 30
= €451,080 ?

Does the Cost of credit €201,204 basically mean the profit made by the bank?
ie (€250,000 - €451,080 )
 
Astro_man said:
TAm i correct in saying that the overall sum paid back over the duration of the mortgage is....(€1253 x 12) x 30
= €451,080 ?
Click to expand...
Yes


Astro_man said:
Does the Cost of credit €201,204 basically mean the profit made by the bank?
ie (€250,000 - €451,080 )
Click to expand...

It's the interest charged - not all profit - but a fair proportion of it would be profit. The banks a re making billions a year .
 
Astro_man said:
Am i correct in saying that the overall sum paid back over the duration of the mortgage is....(€1253 x 12) x 30
= €451,080 ?
Click to expand...
The theory is correct.

Be careful with the rounding of figures when dealing with such large multiples. By dropping the €0.35 from the monthly payments you've come up with a figure of €451,080 instead of €451,206.

Does the Cost of credit €201,204 basically mean the profit made by the bank?
ie (€250,000 - €451,080 )
Click to expand...
As mentioned by irishlinks, it's not all profit for the bank. They have costs associated with this too (google Euribor for example).

The best description to describe "Cost of credit" is.... the cost of the credit! It's what you are being charged over and above the original loan amount.

As you can see from the two examples above (20 and 30 year loans using the same assumptions, e.g. a constant 4.5% rate), extending the term of the loan has a significant impact on the total cost of the loan.

The benefits of this (lower monthly outgoings) need to be balanced against the long term impact (increase in net cost) to strike a balance which meets your needs and your ability to repay.
 
I have a similar question which I hope someone will be able to help me with, as I am not very good at using calculators.

I have just put €250,000 on deposit with National Irish Bank at 5% fixed for 20 years. They will pay me the interest gross once a year at the end of the year.

I know I am going to be rich as a result of NIB's generosity, but could someone please tell me exactly how rich I am going to be.

Brendan
 
Brendan - I am no good with calculators either but I would be expecting a similar return afterall what's good for the goose should be good for the gander:)
 
Originally Posted by Astro_man

Please..oh please show calculations for a confused boy :confused:
Any help would be appreciated


Hi Astro_man.

I have a detailed month by month spreadsheet showing a breakdown of the 240 payments (20 yr mortgage) showing exactly what capital repayment along with what interest you will be paying. although be warned, it's scary to see.

for example your monthly repayments would be €1,581.62 (over 20yrs) with 59% of the first payment being interest (ie €937.50) and the remainning 41% being capital repayment (ie €644.12). In the first 5 yrs alone you would pay €51,647.38 in interest and the total interest payable would be €129,589.63 giving an average payment of €539.96 per month for interest alone.

The reason i can tell you this is i've done a bit of research lately into how mortgage repayments etc are calculated. it was bugging me that every month i was paying out a large amount of money to a bank and i hadn't a clue how it was calculated and most importantly whether it was correct or not so with a bit of research i built myself a mortgage calculator using microsoft excel and which gives very detaild breakdown off all payments etc. and allows for adjustments because of rate increases/decreases etc.

anyway, hope this is of help to you.
 
Hi Supe


You are dead right. Why should Karl Jeacle have a monopoly on this?

By the way, I have always felt that there is something inherently inefficient about the wheels on my bicycle. Would you have any ideas on an alternative to wheels?

Brendan
 
Originally Posted by Brendan http://www.askaboutmoney.com/showthread.php?p=643602#post643602
By the way, I have always felt that there is something inherently inefficient about the wheels on my bicycle. Would you have any ideas on an alternative to wheels?
Click to expand...

hi brendan.

best advice i can offer is place a wanted ad in www.buyandsell.ie for a new set of wheels and if this doesn't bear fruit i would highly recommend a good pair of comfortable walking shoes.

you see just because one method exists it doesn't mean you can't try an alternative method.

(ps - have you checked the tyre pressure in your wheels? under inflated wheels require more pedal power for movement therefore making them inherently inefficient.)

hope this is of help. but sure if not no harm done.
 
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