First year of repayment mortgage, WTF!

What you pay back is simply reducing the debt.

I know! Ronald said it was "rubbish". You said you agreed with him.

Are you able to explain?

"Peter Saxton" wrote

... and that debt is made up from capital and interest (usually, the interest is paid off within the repayments as you go along).

"Peter Saxton" wrote

Yes. That was the answer to your question: "Which [of RR's points] did I say were rubbish when they were perfectly valid?" -- which you jolly well know.

"Peter Saxton" wrote

No I'm not. Learn to read properly!

"Peter Saxton" wrote

... which is made up from capital & interest ...

"Peter Saxton" wrote

No, AIUI he said that the bit about "no split" was rubbish.

Ronald quoted me and then said "That's rubbish" - see below:

START OF QUOTE

That's rubbish. You pay a fixed amount each month, and some of each payment is interest on what you owed during the last month, and the rest reduces what you owe.

END OF QUOTE

Any sensible person would take that to mean that Ronald thought the two sentences were rubbish. You are trying to get me to believe that his quoting two of my sentences and then saying "That's rubbish" meant one sentence was rubbish and one sentence was not rubbish.

If I was stating that something was rubbish I would quote what I thought was rubbish and exclude from the quote what I didn't think was rubbish.

Your confusion over mortgage payments seems to extend to paragraphs. Think of one sentence as capital, the other sentence as interest and the paragraph as the mortgage payment. Ronald didn't distinguish between the interest and capital - he quoted the mortgage payment!

As it happens, Tim was mistaken when he said "That bit's OK.". Both your sentences *were* rubbish. The first one obviously so, the second one not obviously so, and it was wrong for two reasons.

For one it was ambiguous. Ordinarily if you were to say "You A, B, and C continuously until D" you'd think the scope of "continuously" to be "A, B, and C". However, normally what happens in a typical repayment mortage is that "A" (the borrowing) happens only once, at the outset, and only the B and C parts happen continuously. To be more precise, they happen repeatedly, not continuously, but I'll excuse your unawareness of the subtle distinction.

The second thing that was wrong with it was that you used the word "repayments" when you should have used "payments". It is implicit in the "re" part of "repayment" that you are paying something *back*. You can only *pay back* what has previously been *paid out to you*. So any *repayment* must be of capital and not of interest (since interest was never paid to you, it was only charged to you, and you must pay it). Since my position is that part of each payment is a repayment of capital and part of it is paying the interest which has been charged, I was perfectly entitled to declare your sentence to be rubbish on that basis.

I agree with both your points. I took advantage of the usenet tradition of not bothering to be 100% precise but typing enough so you understand what I meant without taking long to construct my argument.

I am sure you understood the thrust of my argument and accept my case evein if you won't go public!

Just because you dont understand maths, dont accuse the mortgage co of 'ripping you off', its maths that means it operates that way, not First National.