Get your cash back from your borrowings
Mortgage is a term derived from Latin word which means a pledge taken against doubtful debts. It is used as a device to protect a lender by giving him a certain percent of interest in property of his borrower. It is nothing but a sale between a mortgagor and the mortgagee with specified conditions. There are distinct types of mortgages available. Each type of mortgage has its advantages and disadvantages. Of these, cash back mortgaging is a unique type of mortgage.
Cash back mortgage includes a deal in which a lender gives a lump sum of money to the borrower either before the payment for a property or after getting the first month payment. The amount of cash can be determined at the time of putting the deal. It may vary from person to person. But usually the lenders give back 5% of their cash. There are certain lenders who give back their amount up to 10%.
TWO OPTIONS IN CASHBACK MORTGAGE
Standard Variable Rate
Two options can be used for offering a cash back mortgage. A lender has to fix a standard variable rate to provide such a cash back mortgage. It may be as high as 6% of the new mortgage amount. The cash has to be paid within 2 to 3 weeks after the date of completion of mortgage agreement. If you do not prefer this option, you can go for the other.
Fixed or Discounted Rate
Under the second option, the cash has offered along side another mortgage property. Here the rates are fixed or discounted rate. If the borrowed amount is small, you can prefer this option. Therefore the borrowers can make use this amount to cover their nominal expenses like legal costs, valuation fees etc.
You can select either standard variable rate or fixed or discounted rate for getting the cash back on your mortgage amount.