Cash Back Mortgages
These are often given as an incentive to new borrowers. They are usually based on a percentage of the amount borrowed. Rates vary but can range from, say, 3% to 6% of the amount borrowed. A lender may also offer a larger cashback with a higher interest rate or a lower cashback with a lower interest rate. To prevent borrowers from transferring their mortgage from one lender to the next, picking up cashbacks each time, there is usually a period during which a proportion of the cashback must be returned if the mortgage is redeemed early, or repaid in whole or part.
Although marketed as a 'product', cashbacks are a product feature - they can apply to both fixed and variable rate mortgages depending on the lender's product portfolio and selling objectives.
Your home may be repossessed if you do not keep up repayments on your mortgage.
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