There are many different types of mortgages available, and most of them are entirely different. In this article, we will talk about the cashback mortgage and how it works.
Does it benefit you in the long term or short term? How does it compare to my other mortgage options in Sheffield? Let’s take a look and answer the most frequently asked questions regarding cashback mortgages.
Firstly, if you prefer to watch our moneymanTV video on cashback mortgages, feel free to watch it below. As a Mortgage Broker in Sheffield, we receive many questions about cashback mortgages, so mortgage advisor and our managing director Malcolm ‘the Moneyman’ decided to make a video to make cashback mortgages easier to understand:
Cashback mortgages are pretty self-explanatory. To put it simply, after paying off your mortgage or after finishing your mortgage term, you will get some money back.
The sum you get back gets based on a percentage of what you have borrowed. It usually’s something small like 1 or 2%. Some lenders like to have a fixed price in the contract. Even if you have a long mortgage term, this is a fixed amount, and it will not increase over time.
Cashback mortgages come with both advantages and disadvantages. For example, some Cashback Mortgages might come with a free property valuation or some fringe benefits.
Cashback Mortgages can be very attractive to customers that are borrowing lower mortgages. You will get some money back plus some benefits on the side. If you are offered a reasonable percentage on your Cashback Mortgage, you should consider taking it up as it may be worth it in the long term.
The only real disadvantage to a cashback mortgage is that they usually come with high-interest rates.
Compared to other mortgage options available, Cashback Mortgages are not the most popular. However, they are still worth considering. We still see customers at Sheffieldmoneyman looking for Cashback Mortgages, and they are a great backup option if you don’t qualify for your first choices.
If you want a more in-depth viewpoint, be sure to book your free mortgage appointment online or give us a call to speak with a Specialist Mortgage Advisor in Sheffield. Our team will be more than happy to explain the benefits of taking out a Cashback Mortgage and why they could be a suitable option for you.