Hi, just wondering what happens to an overpayment on a mortgage?
Say for example your mortgage is €200,000 and payments are €1000 a month and your statement tells you it's split 600 capital and 400 interest.
The next month your interest is based on €199,400. I think that's correct, although figures are simplified.
However if instead of €1000 you pay €1200, does this mean the next month your interest is based on €199,200 as the extra comes off the capital? So interest should be marginally smaller?
Good morning Wheety, thanks for getting in touch. Anything you overpay on a mortgage account with KBC will come directly off the capital balance of the mortgage. This in turn would reduce how much interest you pay on a monthly basis yes. Thanks, Katie