Repayment mortgage monthly payment figure

[SurreyGuy]

I'm new to all this mortgage malarky, so can someone please explain (gently and in idiot-speak)...................... does my monthly outgoing payment on a repayment mortgage go down year-on-year?

T.I.A.

[buildersmate]

No, not normally. Your repayments each month comprise two elements, a sum that pays the interest on the loan, a sum that pays a bit off the capital sum borrowed. The mortgage company calculate the repayment sum so that over the loan period of (perhaps) 25 years, the repayment required is a flat sum each month.
In the first few years of the loan, the proportion of what you pay each month that goes to covering the interest is very high (because the amount of the loan outstanding is at its highest). However as years go on, the capital sum gets smaller, so the amount of interest required to service the capital goes down leaving a larger proportion of the payment to reduce the sum outstanding even further. So it has a spending up effect. This is why you pay off so little of the capital in the first 5 years, yet in the last 5 years of a loan period, most of what you are paying contributes to capital repayment.

[Hammer]

If you pay �100 per month now, you will always pay �100 per month (a bit simplistic and ignores interest rate movements and other variables, but is generally the case).

So the actual amount doesn't go down over time, but inflation means that in 20 years time �100 will be worth less.

[SurreyGuy]

Thanks guys