a first-time buyer and am doing my research to see what my options are for taking out a mortgage. There are quite a few banks with very attractive cashback offers if you take out a mortgage with them. My budget will only stretch to a house that needs some work, so I am very tempted to go for one of these cashback offers. Are they a good idea? Marie, Walkinstown, Dublin 12 BECAUSE of the long-term nature of a mortgage (usually between 20 and 30 years), even a small difference in the interest rate you are paying can lead to big savings. Most banks are offering some form of introductory offer — such as a discounted interest rate for a certain time or getting cash back when you draw down your mortgage (and perhaps later, too).
If you need money to do up an older house, this will obviously be very appealing, but it’s important to focus on the interest rate and make sure you compare it to other lenders in the market — otherwise you could end up paying more longterm for a short-term benefit. To help you decide which lender to use, park the cashback offer.
Be aware of any conditions attached to any cashback offer. For example, you may not be allowed to switch your mortgage to another lender for a certain number of years (often within the first five years). If you do want to switch lenders within that time, you may have to pay all or some of the offer back to the bank.
You can use the mortgage comparison on the Competition and Consumer Protection Commission’s website (ccpc.ie) to compare mortgages from the different lenders.