Posted on: 12th Aug, 2009 06:28 pm
When is mortgage interest rate paid. In arrears or ahead
Along with yoru monthly payment.
Some of it goes to principal and some towards interest
In the beginign you pay mostof ti towards the interest
Some of it goes to principal and some towards interest
In the beginign you pay mostof ti towards the interest
the standard for mortgages is that you pay interest in arrears. the only (usual) exception to this rule is at closing. when you close on a new loan, you will pay interest for the remaining days of that particular month, in advance. subsequently, you'll pay interest in arrears for the remainder of the mortgage term.
an example: you close on a purchase on august 14, 2009 and pay interest for the remaining days (18 days). your first regular monthly payment is due on october 1, 2009 and will incorporate the interest earned by the lender during the month of september, 2009. that schedule will prevail throughout the remaining term of your loan until the loan is paid in full.
an example: you close on a purchase on august 14, 2009 and pay interest for the remaining days (18 days). your first regular monthly payment is due on october 1, 2009 and will incorporate the interest earned by the lender during the month of september, 2009. that schedule will prevail throughout the remaining term of your loan until the loan is paid in full.
