CashBack Mortgage

The CashBack Mortgage puts money or cash to the pocket or bank account of the mortgagor or borrower whenever the mortgagor or borrower takes on a mortgage. The mortgagor or borrower gets a certain percentage back on the amount of mortgage. And, the money is free to spend on vacation, home improvements, investments, closing costs, moving costs, furniture, appliances, or other expenses.

I know what you are thinking. It sounds too good to be true. On the contrary, the mortgage lenders effectively use the CashBack Mortgage as a marketing tool. An extra money or cash just lures many borrowers.

Usually, the mortgage lenders gives 4%, 5%, or 6% cash back to mortgagor or borrower. To calculate the CashBack on Mortgage, you simply multiply the total amount of mortgage by the percentage of the CashBack Mortgage. For example, the borrower took a $250,000 with a 5% CashBack rate. The borrower sends $18,750 to their bank account.

The mortgage lenders approves up to 95% of the value of the property. That means the borrower pays at least 5% down payment.

Depending on the terms and conditions of the mortgage, the interest rate on a CashBack Mortgage may be slightly higher. For example, the mortgagor or borrower pays 5% interest rate without CashBack, or 6.5% interest rate with CashBack. For example, the borrower took a $250,000 mortgage amount, and 30 year mortgage. The borrower pays $1,342.05 mortgage monthly payment without CashBack, while the borrower pays $1,580.17 with CashBack. This may raise a red flag. Hold on to your horses. Suppose the borrower took 3 year mortgage term. After the 3 year mortgage term, the borrower paid a total of $48,313.80 without CashBack, or $56,886.12 with CashBack. The borrower pays an extra $8,575.32. With a 5% CashBack rate, it is still advantageous for the borrower. The $18,750.00 CashBack is greater than $8,575.32 extra payment on CashBack Mortgage.

Some mortgage lenders offer higher CashBack rate on longer mortgage term. For example, 4% CashBack rate on 3 year mortgage term, 5% CashBack rate on 4 year mortgage term, 6% CashBack rate on 5 year mortgage term, and so on.

The cash from CashBack Mortgage can also pay off the mortgage early. Basically, the principal goes down faster with any form of extra payment. The borrower can wish to pay extra on mortgage payment. As long as the extra payment does not exceed the allowable amount from the term and conditions of the mortgage, the borrower pays nothing on penalty.

The CashBack Mortgage is worth considering. Especially, you are a bit short of cash. This mortgage option may be advantageous. When you are shopping for the best CashBack Mortgage, the borrowers need to compare the mortgage term, CashBack rate, down payment, and interest rate.

Refinance Mortgage Broker: How to Find a Good Mortgage Broker Online

If you are in the market for a new mortgage or are refinancing your existing mortgage, a mortgage broker could help you find the most competitive loan offer. There are risks when using a mortgage broker; you don’t want to overpay for the financing or your broker’s commission. Here are several tips to help you find a good mortgage broker without losing your shirt.

Research Mortgage Brokers Using the Internet

The Internet is an excellent tool for locating and researching mortgage brokers. When you compare mortgage brokers pay close attention to what the broker’s fee is and who pays it. You need to be careful when it comes to broker fees because you don’t want any points you agree to pay going to the broker as a bonus. Remember, a mortgage broker is an individual that refers your business to a lender for a commission. Read all the find print and ask for references before signing an agreement with a mortgage broker.

Carefully Compare Loan Offers

Ask your broker for quotes from a variety of different mortgage lenders. Have the broker request Good Faith Estimates for each mortgage offer you consider. Your mortgage broker has extensive contacts in the mortgage industry and should be able to provide loan offers tailored to your financial situation. This is especially helpful for homeowners with poor credit ratings. When you compare loan offers it is important to do a line by line comparison of the Good Faith Estimate for each mortgage offer you consider.

Choose the Best Mortgage Offer

Once you have decided on the best mortgage offer stay in close communication with your broker and the lender. The mortgage lender will only guarantee the interest rate for a specified period of time. If you are unable to close before the guarantee expires the mortgage lender will raise your interest rate. To learn more about your mortgage options including common mistakes when working with a mortgage broker, register for a free mortgage guidebook.