Home prices have risen to record highs, so refinancing might be the right move for your future. Whether you have been in your home one year or 10 years, you might want to consider refinancing your home. If you have equity in your home, you are eligible. The benefits of a cash-out refinance are rewarding short-term as well as long-term.
It’s easy. Let’s say Cameron Johnson’s home is worth $300,000, and he owes $150,000. This means he has $150,000 in equity to access. With cash-out refinancing, he could tap into his equity for: debt consolidation or home improvement.
Are you drowning in credit card debt, car loans, student loans, medical bills or all the above? Each of these payments likely have a different have a VERY high interest rate, causing you to pay far more over the years than needed.
Re-visiting our friend, Cameron has a $14,000 left to pay on his student loan and has $20,000 of credit card debt. So, Cameron decides to tap into his equity and borrow $34,000 making his new mortgage balance is $170,000. From there, he can immediately pay off the rest of his student loan and all his credit card debt. Now he has one payment and one interest rate.
“Doing a cash-out refinance has taken a load off my back because I paid off $120,000 worth of debt saving me $2,400 per month! Loan Pronto made the entire process easy and stress-free.”
A cash-out refinance is something to consider if you have been thing about more to a newer home, but you don’t want to leave the area you live in. A cash-out refinance may be the best option because you can borrow from your equity and add the money on to your mortgage payment. By doing this, the value of your home could increase substantially.
Cameron has decided this summer he wants to renovate his back yard and add a functional outdoor living space, as well as, an in-ground pool. Cameron decides he will need $50,000 to complete the renovation. He then concludes that it would be smarter to do a cash-out refinance instead of taking out a separate line of credit on a home improvement loan. Since he had $150,000 left on his loan, he now has a new mortgage of $200,000.
Take a look at our checklist to see the basic documents you’ll need to apply.