Is it advisable to get a Home Mortgage at prime minus one for 4 months and get 5K Cash back?

My lender is giving my 5K back for a mortgage of prime minus one for few months and then he will refinance. He says that I will get huge incentive and then he will refinance at almost no cost.


Any comments or suggestions... ?Is it advisable to get a Home Mortgage at prime minus one for 4 months and get 5K Cash back?
Will he guarantee all this in writing? I suspect not, so if he won't walk away.Is it advisable to get a Home Mortgage at prime minus one for 4 months and get 5K Cash back?
Don't do it. If you don't NEED it, then don't do it. Most small 2nd mortgages have pre-pay penalties.





What rate is he planning on refinancing it at? Why can't you just get that rate now? Prime - 1% is 7.25%. You can get a better rate on a credit card (0% 12 month offers).





Keep your eyes open.
It's not really a good idea to continuously refinance. It is always best to build credit history with your creditor. What you should really determine is if you can afford the loan that he is providing you without the incentive. Also, I would keep away from negative amortizing or interest only loans since you are not building any principal.





Overall though, it really depends on specifics of your situation such as is this for investment or for yourself, etc.

the bees

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