Posted on 6 February 2011 by DARREN SMART
My £98000 interest only mortgage has 20 years to run and I pay about £450 a month. If I paid off a £40000 lump sum now how would it change my current payments, also how much would I pay if changed to capital & interest mortgage taking into account £40000 paid off?
Working backwards from your loan amount and monthly payment I calculate your current rate of interest to be around 5.50%. Using this figure your interest only payments would reduce to £265.84. The capital & repayment monthly payment would be slightly higher at £398.97.
If the interest rate I have used is incorrect, you can calculate the payments on our Mortgage Calculator.
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