0

I am trying to calculate the amount of interest I need to pay for a mortgage that just turned from fixed to floating.

  • Current balance is: -550,000
  • Interest rate: 5.95%
  • Original term: 30 years

The monthly interest is calculated as:

  • 550000*0.0595/12 = 2727.08333

The fortnightly interest is calculated as:

  • 2727.08333/2 = 1363.54

Was I correct?

  • 3
    Looks fine, but there are 26 fortnights in a year, not 24. – Hart CO Mar 15 '18 at 20:19
  • @HartCO, thanks for pointing it out. My assumption was wrong. – Yu Zhang Mar 15 '18 at 20:25
  • 1
    So yours was semi-monthly rather than bi-weekly, both are somewhat common alternatives to monthly mortgage payments. – Hart CO Mar 15 '18 at 20:37
  • You will save a lot of money if you convert that to a conventional mortgage, unless you have really poor credit scores. – Norm Mar 16 '18 at 19:28
  • @Norm, conventional mortgage? Did you mean fixed mortgage. – Yu Zhang Mar 16 '18 at 20:31

Your Answer

By clicking "Post Your Answer", you acknowledge that you have read our updated terms of service, privacy policy and cookie policy, and that your continued use of the website is subject to these policies.

Browse other questions tagged or ask your own question.