Cash Back Mortgage
This type of mortgage has become increasingly popular over the past few years, which enable first time buyers, or those on a tight budget, possibly because you took out a loan for the deposit for the mortgage. Once the deal is done, your mortgage lender will reimburse a certain proportion of your mortgage loan. This could be as much as a couple of thousand pounds, depending on the mortgage lender and the size of the mortgage. Previously this type of mortgage was available only on variable rate mortgages but can now also be taken out in conjunction with any of the other special mortgage deals. The disadvantage to this type of mortgage is that, by taking the cashback from the mortgage, the rate of interest you pay is likely to be less attractive than a non-cashback mortgage. If you repay part of the mortgage or redeem it in full during an initial period, you may well be asked to pay back some or all of the cashback payment.