Hi all, I am switching from a fixed rate with Permo that's up in December to Avant. The process is going slowly and it looks like I will be switched to a variable at Permo for a month or so. Does anyone know how to calculate what I will owe to them exactly when I switch?
Switching - calculating final monies owed
- Thread starter Tomban
- Start date
Brendan Burgess
Founder
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- 52,050
Hi Tom
Are you saying that your fixed rate will end on schedule and then you will be on a variable for one month?
If so, there is no penalty for terminating a variable rate early.
Brendan
Are you saying that your fixed rate will end on schedule and then you will be on a variable for one month?
If so, there is no penalty for terminating a variable rate early.
Brendan
Thanks Brendan, no my query is how that exact final amount owed is calculated. Do they just recalculate the outstanding versus the interest rate daily?
Brendan Burgess
Founder
- Messages
- 52,050
Yes. Every day interest is added to your account.
If you have a mortgage of €100k @4% , the annual interest is €4,000 so the daily interest is €10.96
It's a tiny bit more complicated than that, because on a particular day each month(?) they capitalise the interest.
So they are charging interest on €100k today, but they add €339 to it tomorrow for the interest charged but not capitalised over the last month.
But if you have a recent statement, you can calculate it yourself very closely.
Brendan
If you have a mortgage of €100k @4% , the annual interest is €4,000 so the daily interest is €10.96
It's a tiny bit more complicated than that, because on a particular day each month(?) they capitalise the interest.
So they are charging interest on €100k today, but they add €339 to it tomorrow for the interest charged but not capitalised over the last month.
But if you have a recent statement, you can calculate it yourself very closely.
Brendan
That's great, thank you so much Brenden