Originally posted by Anthonyacat
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Our kids want to pay our mortgage off.
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My calculations on interest-only came in only slightly less than our current mortgage outgoings
If this is true, your calculations are either flawed or you are very near the start of the mortgage term!
At the very start of a 6% interest, 25-year mortgage term, 22% of your payments go to Principal, with the other 78% to interest. 5 years in, this is up to 30/70. Half way at 12.5 years it's at 47/53. 20 years, and you're up to 74/26. The final year ticks away from 94/6 all the way to the last month which is pretty much 100/0.
The math is a little different with different mortgages terms and interest rates, but the pattern holds.AAT Accounting Services - Property Specialist - [email protected]
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Originally posted by Anthonyacat View PostMy calculations on interest-only came in only slightly less than our current mortgage outgoings
If this is true, your calculations are either flawed or you are very near the start of the mortgage term!
At the very start of a 6% interest, 25-year mortgage term, 22% of your payments go to Principal, with the other 78% to interest. 5 years in, this is up to 30/70. Half way at 12.5 years it's at 47/53. 20 years, and you're up to 74/26. The final year ticks away from 94/6 all the way to the last month which is pretty much 100/0.
The math is a little different with different mortgages terms and interest rates, but the pattern holds.
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