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Let's say a customer wants to transfer $400,000 mortgage to CIBC. He has 2 options. 5 I2 Y+ K* q: u% @; f" I
1. 3-year closed mortage with 3.3% and 3% cash back.
2 M8 ?2 s! ]0 X. E2. 5-year closed mortgage with posted rate 5.39% and 5% cash back
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Option 1. After 3% cash back, your mortgage amount will become $400,000*0.97=$388,000 with 3.3% interest
, X/ W8 w7 C. W( {7 f; |2 a3 TIf you want to payoff your mortgage in 25 years. Monthly PMT $1896.44. The remaining balance is $356,393 after 3 years.$ {" _! W3 j- w( }/ _
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Option 2. After 5% cash back, your mortgage amount will become% K8 n% Z6 C3 P# A: Y+ u$ O6 {
$400,000*0.95=$380,000 with 5.39% interest.- V. A; G) G4 b" c
If you want to payoff your mortagge in 25years. Monthly PMT 2295.21 The remaining balance will be $356,351.50 after 3 years1 Y$ j. r1 Q5 H7 T* V' f8 h1 C6 h% z5 U
; b7 X3 a; J7 k# _9 F1 LBasically, for the above options, after 3 years, the mortgage remaining balance is similiar.
' P8 {. I7 X$ o* `9 v, ZIf 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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