If you have a mortgage with either a bank, credit union or a trust company, each month you'll make a monthly payment that will go toward paying back the amount you borrowed (commonly called the principal), plus interest. If you mortgage payment is with a private lender, the mortgage payment is typically interest only although some may have a 40 year amortization.
Your mortgage statements will show how your payment is broken up. Initially, the bulk of your payment will go toward paying down the interest on the loan, but over time, more of your payment will go to paying down the principal balance.
When will my first mortgage payment be due?
Your first mortgage payment won't be due for up to two months after closing. If you close on June 9, for example, you'll pay per diem interest at closing to cover the period between June 9 and June 30. Then, your payment for the month of July will be due on August 1.
Use our amortization calculator to see how your monthly payment breaks down and how additional payments can save you money on interest.
What should I do if I'm going to miss a mortgage payment?
Contact your lender about 10 to 12 business day before your payment is due if you think you are going to miss a payment. Payments are on an automatic withdrawal system and they will need time to contact the bank to stop the payment from going through. This will keep your credit intact by not having any NSF on your account and you will not have to pay a bank NSF bee plus a missed payment fee to your mortgage lender. Missing multiple payments can hurt your credit score, but it can also lead you to default on the loan – and you could lose your house. If you're experiencing a hardship, your lender may be able to create a payment plan to help you get back on track.