YOUR CLIENT’S
FIRST PAYMENTS
Points to consider if there is any lexibility on the completion date
We have created this handy guide to help you explain to your clients the way that irst
payments work, depending on their completion date.
You may want to pass this on to your clients, or use some of the examples below to
help explain their irst payment to them.
First payment date reminders
• No payment is taken in the month the customer completes.
• The chosen completion date will determine the collection date and the amount of the irst
monthly payment.
• The irst payment will always be greater than the regular monthly payment because it includes
accrued interest from the completion month. Regular monthly payments are always set to be
taken by Direct Debit on the 1st of the month.
• If there is not 16 working days between the day the mortgage completes and the irst of the
following month, the irst payment will be taken 16 working days after the completion date.
• If the payment day falls on a weekend or bank holiday, the payment will be collected on the next
working day. If the next working day is in the following month, the payment will be taken on the
previous working day.
• The customer will receive conirmation of their irst payment amount and regular monthly
payments in the welcome letter which is sent post completion.
Where your client can ind their payment information
Section 6 of the ESIS “Amount of each instalment” illustrates that the irst payment will dier from
the regular monthly payments. However, the variation of the amount will depend on the day of the
month the ESIS is generated as the illustration assumes this day is the completion day.
More detailed information on what a customer must pay can be found in section 5 of the Mortgage
Conditions “What you have to pay and when you have to pay it”.
If a mortgage completes on the irst day of the month, the irst payment will be almost double
the amount of the regular monthly payment. So, whilst the customer will make no payment in the
completion month, there will be a large payment due in the second month.
If the mortgage completes on the last working day of the month, the irst and the second payment
could be due for payment within 7 working days of each other. These payments will still be collected
in 2 dierent calendar months.
If the mortgage completes mid-month there is generally at least 2 calendar weeks between the irst
and second payment. And although the irst payment amount will always be greater than the regular
monthly payment amount, it is likely to only be between 916 days of accrued interest at this point in
the month.
K M LIT 0090 OCT23
FOR INTERMEDIARIES ONLY
Kensington and Kensington Mortgages are trading names of Kensington Mortgage Company Limited. Registered in England & Wales: Company No. 03049877. Registered address: Ascot
House, Maidenhead Ofice Park, Maidenhead SL6 3QQ. Kensington Mortgage Company Limited is authorised and regulated by the Financial Conduct Authority (Firm Reference No.
310336). Some investment mortgage contracts are not regulated by the FCA.
Completion and irst payment date examples
EXAMPLE
EXAMPLE
EXAMPLE
EXAMPLE
EXAMPLE
A mortgage of £301,500 completed on the 1 June 2023
A mortgage of £200,000 completed on the 8 June 2023
A mortgage of £211,500 completes on the 15 June 2023
A mortgage of £242,250 completes on the 22 June 2023
A mortgage of £69,850 completed on the 29 June 2023
The customer’s irst payment is almost double the regular monthly payment
amount because it includes July’s regular monthly payment and a month of
accrued interest from June.
The customer’s irst payment includes 22 days of accrued interest from June
and July’s regular monthly payment amount.
The irst payment includes the regular amount for July and 16 additional days
of accrued interest from June and leaves 22 calendar days before the next
payment is due.
The irst payment includes the regular monthly amount for July,
9 additional days of accrued interest from June and leaves 17 calendar days
before the next payment is due.
The customer has 11 calendar days between 2 payments.
Key takeaway
Key takeaway
Key takeaway
Key takeaway
Key takeaway
The first payment of £3,671.01
was taken on the 1 July 2023.
The first payment of £2,192.63
was taken on the 1 July 2023.
The first payment of
£1,913.99 was taken
on the 7 July 2023, 16
working days after the
completion date.
The first payment of
£1,883.56 was taken
on the 14 July 2023, 16
working days after the
completion date.
The first payment of
£573.91 was taken on
the 21 July 2023, 16
working days after the
completion date.
The irst payment included
interest accrued between
130 June and the regular
payment for July, making the
irst payment almost double the
amount of the regular payment;
an additional £1,657.79.
The irst payment included
interest accrued between 830
June and the regular payment
amount for July; an additional
£686.85.
The irst payment
included interest
accrued between
1530 June and July’s
regular monthly
payment amount; an
additional £592.43.
The irst payment
included interest
accrued between
2230 June and July’s
regular monthly
payment amount; an
additional £396.63.
The irst payment
included interest from
29 to 30 June and
July’s regular monthly
payment amount.
The second payment of
£2,013.22 was taken on the
1 August 2023 at the regular
monthly payment amount.
The second payment of
£1,505.78 was taken on the
1 August 2023 at the regular
monthly payment amount.
The second payment
of £1,321.56 was taken
on the 1 August 2023
at the regular monthly
payment amount.
The second payment
of £1,486.93 was
taken on the 1 August
2023 at the regular
monthly payment
amount.
The second payment
of £543.52 was taken
on the 1 August 2023
at the regular monthly
payment amount.
The customer has 22
calendar days between
the irst and second
payment.
The customer has 17
calendar days between
the irst and second
payment.
The customer has 10
calendar days between
2 payments.
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