Cashback Mortgages
Cashback mortgages is where borrows receive a cashback incentive in the form of a single lump sum of cash immediately on completion of the mortgage transaction or shortly after completion.
The amount of the lump sum is generally a percentage of the amount borrowed and calculated as a percentage of the overall loan amount, though it can be a set figure.
The percentage of the loan that is given as cashback can be as high as 5%, though amounts in the region of 1 to 3% are more common. Various different types of rate can come with cashback - capped, discounted, fixed and variable.
There are also a lot of mortgages that award you three or four hundred pounds
to go towards your solicitor's fees. Although this is a form of cashback,
it would generally be classed as an incentive and not specifically as a cashback
mortgage.
Click for more mortgage glossary terms relating to remortgaging.