Cashback Mortgage

Johnny2323

I'm tempted by Chelsea's Cashback mortgage. They give you 5% back when you transfer but you have to stay with them for five years on a very high rate (think it's 6.74%).
My senses are telling me not to go for it - am I right?

payless

depending on your circumstances there are "better" cashback deals around - lower charge rates or higher cashbacks

rarely do these deals work out cheapest - but with cash upfront, they can sometimes work out good, especially if you have a short term repayment mtg

mickeynospecs

I'm just remortgaging at present through a broker. We reviewed this type of mortgage and the addage "owt for nowt" was applicable. Over the period of the deal you end up paying it all bank plus more.
Go through a broker - it may cost you around £150 - but you'll be better off. Review Martin's mortgaging guide. It is excellent.

payless

mickeynospecs wrote:

I'm just remortgaging at present through a broker. We reviewed this type of mortgage and the addage "owt for nowt" was applicable. Over the period of the deal you end up paying it all bank plus more.
Go through a broker - it may cost you around £150 - but you'll be better off. Review Martin's mortgaging guide. It is excellent.

Yes - often the case, especially for the more popular cashback deals ( they are generally not my favoured product) - but sometimes its worth a closer look ( if prepared to accept a tie) - as I said on shorter term mortgages cashbacks can be an interesting case- as debt is being repaid quickly, but the % cashback is based on the original amount ( unlike a discount where the saving is a % of the reducing balance).

And you can still get a cashback based on a variable rate much lower than the High St SVR ( as mentioned by OP) One particular "interesting " deal is available via a very small lender (criteria might be tighter than some of the lager lenders) - perhaps not included in every broker's research??

If you use addages/ phrases then perhaps "looking outside the box" would be appropriate here - whilst there is nothing special about a "broker" inputting a case into a software program and coming up with "lowest rate" it needs a more detailed review to take everything into account, and look at an individuals actual needs.


Broker fees - I would say still a lot of good advice out there without need to pay fees- unless you are getting their commission rebated ( true independent mortgage advice)