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Let's say a customer wants to transfer $400,000 mortgage to CIBC. He has 2 options. a) I3 o- R6 {1 w0 i
1. 3-year closed mortage with 3.3% and 3% cash back.
7 ?8 M- M) [3 Z2. 5-year closed mortgage with posted rate 5.39% and 5% cash back
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2 ~" O; _4 n+ K" MOption 1. After 3% cash back, your mortgage amount will become $400,000*0.97=$388,000 with 3.3% interest
- W% T2 B- t9 G! f1 r* p& J5 |+ `If you want to payoff your mortgage in 25 years. Monthly PMT $1896.44. The remaining balance is $356,393 after 3 years., t) @# N1 W* E% P4 m
8 s: D9 w D2 s1 ~Option 2. After 5% cash back, your mortgage amount will become$ O3 X5 g5 ]* v( y4 j
$400,000*0.95=$380,000 with 5.39% interest.. c' j2 \+ l A
If you want to payoff your mortagge in 25years. Monthly PMT 2295.21 The remaining balance will be $356,351.50 after 3 years
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9 z% u: F3 R# `( F" R, E, vBasically, for the above options, after 3 years, the mortgage remaining balance is similiar.2 D3 l! h; B0 x
If you choose the 2% cash back with 3.3%, every month you save about $398.77 monthly payment for 3 years. Total roughly saving ($398.77*12*3=$14,355) |
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