Cash-Out Refinance on Your Home Equity Appreciation
This article was originally published by Anthony Duval on Bluefire Mortgage
A cash-out refinance replaces your existing mortgage with a new larger one, so you can use the money however you want 😉🏡
In other words, this type of loan essentially turns home equity into cash.
A Cash-Out Refinance lets you access your home equity through a first mortgage instead of through a second mortgage, like a home equity loan or line of credit. Typically you will need to have 10% to 20% equity left after the refinance. The percentage required varies by lender and whether you’re willing to pay for private mortgage insurance (PMI) on the new loan.
Benefits of a Cash-Out Refinance
- It allows you to borrow a lot of money at a low interest rate
- Your mortgage interest may be tax deductible
- Your new mortgage may have a lower interest rate than your current mortgage
- You can use the cash however you want
- It can help eliminate high-interest debt, pay for college or make your home nicer
- Any cash you put toward repairs and improvements could increase your home’s value even more.
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A Cash-Out Refinance lets you access your home equity through a first mortgage instead of through a second mortgage.
How to use cash-out from your home?
- Debt Consolidation – pay off a HELOC, credit cards, car loans, student loans.
- Home Maintenance – repair your roof or replace your water heater.
- Home Renovations – complete the kitchen or bathroom remodel you’ve always wanted.
- College Tuition – use funds to pay for your children’s educational expenses.
- Save – keep the cash to have on hand for emergencies or special events.
- Reinvest – use the cash for a down payment on another property or second home expenses.
- Invest – add to or start other investments that provide a higher return than a new mortgage cost.
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With a Cash-Out Refinance you can complete the kitchen or bathroom remodel you’ve always wanted!
If you are interested in refinancing your home, be sure to reach out to DG Pinnacle as soon as possible as rates are expected to increase soon!
We urge you to call us at (305) 851-5225 so one of our Loan Officers will discuss your options with you.