What is a cash-back offer or cash incentive?

When negotiating a new lending offer (Either taking a bank new lending as a refinance or a new purchase), we’ll get two things;

  1. Discounted interest rates
  2. A cash-back offer


Sometimes known as a cash incentive, cash offer, cash-back, cash-money. Whatever you’d like to call it, it’s an essential part of a competitive offer. Banks are most willing to provide these offers for lending over your primary place of residence, or over investment properties when you’re also able to give them your primary residence as security.


The amount of cash a bank will be willing to give you depends on your profile. What’s the Loan to Value ratio of your deal, and how much income are you earning? It’s also generally based on how large the loan is. Here’s a rough guide as to the cash incentive you should expect.

Loan Amount



Cash Back



Owner Occupied Lending





Investment Lending











Understanding your cash back agreement

When banks give you a cash incentive, it’s generally to reward you for coming on-board as a new client, and it’s usually used to incentivise you to stay a customer of the bank for a couple of years. Each bank will lock you in for a different amount of time, and these cash incentive agreements are bank wide and completely non-negotiable.


BNZ - 4 year agreement, with a reducing commitment

Westpac - 3 year agreement

ANZ - 3 year agreement

ASB - 2 year agreement


While the BNZ’s cash back agreement ties you in for the longest period of time, each year they will reclaim 25% less than the year before. For example, if you were to switch banks or repay your lending with the BNZ after 2 years, they would reclaim 50% of the money you were originally gifted, while the other banks would reclaim the full 100% all the way through until the end of the agreed period. Each has their pros and cons, which should be considered when discussing the right option for you with your iRefi mortgage adviser.

In what circumstances will the bank reclaim a cash agreement?

If you refinance within your cash back period, the bank will definitely reclaim this gift to you. If repay all of your debt because you’ve sold your house, they’ll also most likely make you repay your cash incentive. If, however, you only repay a portion, and retain some of your lending with the bank, it’s unlikely they will ask you to repay the offer.

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