Let the equity in your home improve your life with a cash out refinance.
Are you having having trouble buying a bigger home for your growing family in today’s market? Are you paying the minimum every month on expensive credit card debt? Have you got a high-interest car loan? If you’ve been in your home for a few years and have seen its value grow significantly, you may be able to tap the additional equity you’ve built to improve your life using a cash-out refinance mortgage.
A cash-out refinance mortgage allows you to draw cash out of the value of your home. You can use the cash in any way you like: make an improvement or addition to your home, pay off a high-interest rate credit card or car loan, or go on a dream vacation!
A cash-out refinance allows you to draw cash out of your home by letting you refinance your current mortgage into one with a higher balance, providing you with the difference (after costs) in cash. The balance of the new mortgage can be as high as 80% of the current value of your home, and you can roll the costs of the refinance into the new mortgage.
Cash Out Refinance Process
The process for a cash-out refinance is straight forward:
- You choose a lender, apply for a mortgage and provide supporting paperwork such as pay stubs, W-2s, bank statements, etc.
- A home appraiser will visit the home to look at its condition and estimate the value.
- An underwriter will review all your documents and the appraisal to approve the loan.
- Your attorney will perform title research and prepare paperwork for you to sign at closing.
As with any refinance, even after you have signed the closing paperwork you have the option not to complete the transaction for up to three days after the closing. Once that time has passed the transaction will be completed, and you will receive your cash.
Benefits and costs
The benefits from a cash-out refinance depend on how you plan to use your cash. Will you make your home a better place to live for your family, pay off high-interest debt, or enjoy an experience you otherwise could not afford?
Closing costs usually include attorney fees, title insurance, lender fees, appraisal fees and miscellaneous additional costs like government recording fees. Some of these fees vary from lender to lender. Your attorney fee will depend on the attorney you choose. You will receive a document that details all these costs when you apply.
Choosing a lender
Shop around and compare rates when you are ready to start your cash-out refinance. You should also consider the people you will work with when deciding on a lender. You will probably talk with your lender’s Loan Officer a lot during the refinance process. Make sure you work with someone you like talking with, who will keep you informed along the way, and who is responsive to your calls. Consider working with a local Loan Officer who you can meet with in person if you want or need to.
In summary
Home values have increased significantly over the past several years, especially here in the triangle area. A cash-out refinance may allow you draw cash from your home and use it in ways that will improve your life!
- Contact Steven
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