Cash back mortgages give consumer a percentage of their mortgage in cash to spend as they please. The money could be used to buy furniture, appliances, pay for closing fees or invest on the stock market whatever the consumer like.
Cash back users generally only get the posted mortgage rate instead/over a re discounted rate. Sometimes there is a big difference between the posted rate and re discounted rate, for example, the posted rate for a five-year, fixed mortgage the standard term for a cash back offer at many major banks is around 5.5% but the discounted rate can be as low as 3.89%.
However, many costumers are still considering going to a fixed five year, full discounted rate, or an even lower variable rate. although cash back mortgages are still a small part of bank's business, they do have benefits.
Taking cash back offer is not advisable to customer planning to sell their house before the five year term is up due to a usual fees associated for breaking the mortgage early plus some of the cash back has to paid back.
TD Canada Trust currently offers a 5% cash-back mortgage up to a maximum $25,000. Scotiabank offers almost the same deal while RBC and CIBC are offering up to 7%.
Consumer planning to take a cash- back program would be easy to qualify it is the same as qualifying for a five year mortgage.
Cash back users generally only get the posted mortgage rate instead/over a re discounted rate. Sometimes there is a big difference between the posted rate and re discounted rate, for example, the posted rate for a five-year, fixed mortgage the standard term for a cash back offer at many major banks is around 5.5% but the discounted rate can be as low as 3.89%.
However, many costumers are still considering going to a fixed five year, full discounted rate, or an even lower variable rate. although cash back mortgages are still a small part of bank's business, they do have benefits.
Taking cash back offer is not advisable to customer planning to sell their house before the five year term is up due to a usual fees associated for breaking the mortgage early plus some of the cash back has to paid back.
TD Canada Trust currently offers a 5% cash-back mortgage up to a maximum $25,000. Scotiabank offers almost the same deal while RBC and CIBC are offering up to 7%.
Consumer planning to take a cash- back program would be easy to qualify it is the same as qualifying for a five year mortgage.
Please go to Article:
http://www.kelowna.com/2010/03/16/some-mortgages-come-with-spending-money/
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