Arrears question when selling property

[Odie240]

I refer to an example on old thread posted by Brendan called capatilising arrears.

Example;
term remaining|20 years
Mortgage balance|€100,000
interest rate|4%
Monthly repayment|€600
Year end balance|€96,800

Now let's say you pay nothing for 12 months
term remaining|19years
Mortgage balance|€104,000
interest rate|4%
Monthly repayment|€600
Arrears|€7,200 You have paid nothing
The interest rate is 4%
So the mortgage balance after one year is €104,000

You were due to pay €600 per month.
So the arrears is €7,200

My Question:

If I owe €100k on Mortgage @ 4% don't pay for 12 months, is the motgage balance now €104k plus arrears of €7,200? If I offer to sell property and repay bank mortgage balance in full - do I owe €100k, 104k, 100k + arrears of €7200 or €104 + arrears of €7200

Am offereing to sell my property under voluntary sale with no negative equity so clearing outstanding balance but bank won't accept due to arrears. Need to understand. Any response much appreciated.

 

[TLO]

Arrears are included in the outstanding balance, €104,000 in the above example. As part of the sale process your solicitor will give an undertaking to the bank that the outstanding balance will be paid in full. The bank will be happy with this. Your solicitor will give you any money left over after 1) outstanding balance is paid to the bank, 2) the estate agent is paid 3) your solicitor is paid.

 

[cremeegg]

TLO is right the balance is €104,000

If you had paid the €600 a month or €7,200 in the year, the balance would have been

€100,000 + €4,000 - €7,200 = €98,600

What you owe €104,000 less what you should owe €98,600 is the arrears = €7,200

The balance is €104,000 of which €7,200 is late or in banker speak, in arrears.