Balance Outstanding

The balance outstanding is the amount you have left on your mortgage or loan. You may also see it written as the outstanding balance. It is the total sum remaining to be paid at the point the sum is calculated.

For example, you may be informed that the balance outstanding on your mortgage as of May 2019 is £239,500. You should receive an annual statement that reveals the remaining balance left to pay at the time the statement was prepared.

If you have online banking, you should be able to log into your account to see the outstanding balance on your mortgage in between statements.

How does the remaining balance change throughout the life of the loan?

This depends on the kind of loan you have. If you opted for an interest only home loan, the capital borrowed would remain the same throughout. You would only be required to pay the interest due each month, while the capital you borrowed would stay the same. Hence why this type of mortgage is now rarely seen. If you do have one, you should arrange to ensure you can pay off the capital by the end of the term.

With a repayment mortgage, your outstanding balance will gradually drop throughout the term of the loan. It drops much more quickly towards the end of the term, by which time most of your monthly payment goes towards the original loan amount rather than the interest it accrues.

Regardless of the sum owed or the interest rate, however, the balance outstanding always refers to the total remaining to be paid off.