Ulster Bank mortgage interest query

[tallpaul]

Quick question: does anyone know if UB charge interest on mortgages on a daily basis or monthly??

I received my Annual Mortgage Statement and from looking at the interest paid each month, it is at variance with my own calculations. In particular, the ECB rate changes for last year (we're on a tracker) were not applied from the day they said they would i.e. 18 May and 22 November but rather from the start of the subsequent month. This resulted in more interest being paid as I was on the higher rate for longer.

The amounts are small but it is the principle of the thing. Has anyone else experienced this?

 

[wbbs]

Calculated daily and added on monthly. The rate changes not from the day the ECB announces but usually couple of weeks later depending on your individual loan offer, info should be somewhere on it as to when the change is applied.

 

[so-crates]

Hi tallpaul,

I too track my repayments on my own spreadie and I am also at variance with their amounts, usually at this time of year I try once again to get them to send me specific details on how they calculate and generally I get no satisfactory response from whichever person answers the phone, usually the best I get is a letter summarising the current amount outstanding, the current repayment amount and the current rate - so basically nothing (though that is better than the year when the person answering the phone didn't even do me that courtesy). I live in hope of the day when the person answering the phone actually understands that the word "calculation" implies a little bit more than 3 numbers which I already have. I doubt even then that they will be able to help as I am sure it is in a black box hidey-hole labelled do not open on a dusty shelf somewhere in a server farm.

I have tweaked and tweaked to see if I can get it to align but so far no luck - the discrepancy is small and (currently anyway) in my favour so I am not too miffed but I feel like I should be able to accurately forecast it and am frustrated that I cannot get to the root of the difference! In their letter about rate change they have in the past sometimes stated what date it was applied, it wasn't always the precise date of the ECB change but it was generally only a couple of days difference so I think they do apply their rate daily.

 

[tallpaul]

Thanks so-crates!!

I too have a detailed spreadhseet and have been able to get my figures to tally exactly with theirs in months where there has been no change of rates. What I have found is:

* Interest is calculated on the first of the month on the net balance of interest applied and repayments made of the previous month.
* Repayments and overpayments are also made on the first of the month;
* Interest for a particular month is based on the number of days in the
PREVIOUS month e.g. interest calculated on 1 May is based on 30 days in April;

My current bugbear is that the ECB rate change of 18 May should have resulted in an interest rate charge on say 50,000 for June being:

((€50000*0.019)*(18/365))+((€50000*0.0165)*(12/365)) where the interest rate went down from 1.9% to 1.65%. They have come up with another figure which I cannot reconcile .

What is even more frustrating for me is that they haven't dealt with the two ECB rates consistently as I can calculate the November reduction using the above formula with revised rates and dates and it tallies with the figure on the annual statement.

 

[Bronte]

Quick question: does anyone know if UB charge interest on mortgages on a daily basis or monthly??

The amounts are small but it is the principle of the thing. Has anyone else experienced this?

Yes I have experience of it, their older mortgages were not daily. Not sure though when they changed to monthly. There was a newspaper article on it about 10 years ago that I have somewhere.

All that said it would be no harm to have it clarified from them in writing that they are applying your interest rate correctly, they had to repay me a 5 figure sum a couple of years ago as they were incorrectly applying my interest rate.