Cash Back Mortgage

Definition

  • A type of mortgage where the borrower receives an extra cash payment in addition to the amount financed to purchase their home. The amount the borrower receives (the "cash back") is calculated on the size and term of the borrower's mortgage using a set percentage (often 5%).

Alternate Spellings
cashback mortgage

Related Terms and Acronyms

  • Creative Financing Definition,
    • An innovative or unusual way of structuring a home loan that allows the buyer to buy the house.
  • Debt Consolidation Definition,
    • The replacement of multiple loans with a single loan, often with a lower monthly payment and a longer repayment period. It's also called a consolidation loan. CanEquity has access to Canada's best debt consolidation products, for more info about debt consolidation see our debt consolidation page.
  • Down Payment Definition,
    • The portion of the purchase price a buyer pays, in cash, at the time the loan originates.
  • High-ratio Mortgage Definition, Important,
    • A mortgage in which a borrower places a down payment of less than 20% of the purchase price.
  • Loan-to-Value (LTV) Acronym, Very Important,
    • The ratio of the principal amount of the loan to the lesser of the purchase price of the property or the property's appraised value. This can be expressed as an 80% loan, or 80% LTV.
    A widely used term in the mortgage brokerage and lending industry, especially by mortgage underwriters.
  • Lump Sum Payment Definition,
    • An extra payment made to reduce a loan.
    • One-time single-sum payment or payout.
  • Mortgage (mtg) Abbreviation, Important,
    • A mortgage is a contract stipulating a specific real property, typically a residence or building, as collateral for a loan. The mortgage incurs a rate of interest that varies according to term and other features.
  • No Money Down Mortgage Definition, Important,
    • Available in Canada as a true 100% mortgage financing product.
  • Refinance Definition,
    • To arrange a new loan for an increased amount or better terms whereby the old loan is paid off from the proceeds of the new loan.
  • Zero Down Mortgage Definition,
    • A mortgage product that allows the borrower to financing 100% of their property.
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