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Cash Back Mortgages....

Cash-back mortgages were brought about by the fact that some borrowers did not have enough money to buy their property by way of deposits or just the associated fees.

For one reason or another they were unable to save up enough for the deposit or could not cover the other costs associated with buying a property and needed that little bit of help those expenses.

As a result lenders saw an opportunity, offer a product that gave these borrowers some money to do the things they needed to do.

Out of this was born the cash back mortgage.

This was later offered to all manner of borrowers even those people arranging a re-mortgage Lenders felt it was good to offer cash back as an incentive to take out a mortgage with them.

Some lenders have been known to offer as much as 10% of the mortgage borrowed as a cash back.

It should be noted though, that all lenders will have hefty redemption
penalties after they have given a borrower a cash back as they do not want someone taking the cash back and then re-mortgage the next day. This means that should you take out a cash back mortgage with a lender expect to be tied into them for a set period of time.

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