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Advice Regarding Cashback on Mortgage Repayments

  • 20-08-2018 5:16pm
    #1
    sjl68
    Registered Users Posts: 1 ✭


    Hi!

    Thanks for taking the time to read this - I'm going round in circles here...

    I have two offers from lenders for a mortgage of 210,000 euro:

    Lender 1 - 2.80% Fixed rate for 5 years. No other incentives.
    Lender 2 - 3.25% Fixed rate for 5 years with 2% Cashback (4200 euro) and also 2% Cashback on all repayments until 2027.

    I am trying to figure out what is the best deal... It seems to me that despite the lower rate of Lender 1, Lender 2 is the better deal over the course of the first 5 years (before the mortgage would switch to the SVR). I realize that the higher interest rate Lender 2 would be 18000 euro more over the term of the mortgage (30 years) but it seems silly to calculate it this way since the SVR interest rate will be unknown after the initial 5 year fixed rate period is complete... Or am I missing something obvious?

    Any advice on what the better option would be would be much appreciated.

    Cheers!
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