UK Cash Back Mortgage

A UK cash back mortgage provides a cash back rebate on completion of the property purchase The cash-back sum is either a percentage of the advance, or a fixed amount.

This cash-back may help you to cover some of the expenses of setting up home. However a UK cash back mortgage tends to be more expensive than a standard variable loan over the long term, due to higher interest rates and other charges levied by the lender.

Benefits of a UK Cash Back Mortgage

With a UK cash back mortgage you receive a cash back rebate from the outset. The cash-back amount is usually between 3 - 5% of the loan value which may help you cover some of the initial expenses of moving, or buying new furniture, etc.

If interest rates don't move higher, and providing you can re-mortgage either without penalty or for a low penalty amount, you may find that the cash back sum received may be higher than any redemption penalties. In other words under 'perfect' conditions you may be able to re-mortgage and come out ahead after paying penalties.

Risks of a UK Cash Back Mortgage

A UK cash back mortgage is often subject to higher repayment rates, and may include penalties for repaying the loan early.

The higher interest rate on a cash-back mortgage, and any increase in interest rates will eventually eat up any benefit from the cash-back sum, over the long term.

For further advice and to talk to a mortgage adviser about arranging a UK Cash Back Mortgage just click on the enquiry button below, fill in brief details, and an adviser will call you within the next 24 hours.