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Let's say a customer wants to transfer $400,000 mortgage to CIBC. He has 2 options. ' E" y' s2 m, c
1. 3-year closed mortage with 3.3% and 3% cash back.
% _" I9 c( {: w0 l8 c2. 5-year closed mortgage with posted rate 5.39% and 5% cash back
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* M# J: d( q" p: n; h: A1 QOption 1. After 3% cash back, your mortgage amount will become $400,000*0.97=$388,000 with 3.3% interest8 h4 G S4 E6 L# B
If you want to payoff your mortgage in 25 years. Monthly PMT $1896.44. The remaining balance is $356,393 after 3 years.
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$ W8 u* X/ _* l6 t, }1 ^$ JOption 2. After 5% cash back, your mortgage amount will become
6 a- ]+ ]5 n: x$ y- }, F3 a: @$400,000*0.95=$380,000 with 5.39% interest.8 j" e# S6 T* }. B4 h+ d y) R
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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/ s2 ^: }7 p& e5 h, H* {1 D* sBasically, for the above options, after 3 years, the mortgage remaining balance is similiar.
$ s. D) V' `! I7 c5 X% dIf 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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