Cash-Out Refinance Guide in Florida
For many families, the equity in their home represents a significant piece of their wealth. For various reasons, sometimes families need to access this equity. Whether for home improvements, debt consolidation, or something else entirely, your home’s equity may be accessible through a cash-out refinance. To discuss a cash-out or other type of refinancing arrangement, contact the professionals at Dynamic Funding today.
What Is A Cash-Out Refinance?
A cash-out refinance is exactly what it sounds like. It allows for a homeowner to refinance their current mortgage loan and, under the terms of the new mortgage, receive a portion of the home’s equity in cash. That amount is combined with the original mortgage amount for the amount of the new refinanced mortgage. The homeowner can then use the extracted cash for home improvement, repairs, or any other purpose.
Cash-Out Refinance: Rates And Guide For Homeowners
The process for obtaining a cash-out mortgage refinancing is substantially similar to most other refinancing choices. Dynamic Funding can work with major lenders to get you the cash out refinance rates Florida. Once you choose your new mortgage, the old loan will be paid off, you receive the negotiated cash-out amount, and then you begin making mortgage payments on your new loan.
A Cash-Out Refinance Can Help You Meet Your Financial Goals
There are a host of reasons for choosing a cash-out mortgage refinance. Families are different and so are their needs. However, some of the most common financial goals people are hoping to meet with a cash-out mortgage refinancing are:
- Home Improvements. Maybe your family has grown and you need another bedroom. Maybe you are in desperate need of an updated kitchen. Maybe you need a new HVAC system. Regardless, home improvements are expensive and cash-out refinancing is one easy way to pay.
- Debt consolidation. Whether your debt is from credit cards, student loans, or something else, you may be able to use your home’s equity to pay these down. Mortgage rates are generally much lower than credit card interest rates.
- College tuition. With the costs of higher education continuing to increase, your home’s equity is an option that does not require student loans.
- Investment opportunities. If wisely invested, your home’s equity can grow exponentially.
Whatever your short and long-term financial goals may be, the loan professionals at Dynamic Funding can give you the best cash-out refinance rates in Florida. Call us today.
How Much Cash Can You Get On A Refinance?
Generally, in a conventional cash-out refinance, a homeowner can borrow up to 80% of the home’s value. This includes the amount you owe on your current mortgage. For example, if the value of your home is $300,000, the maximum refinance amount for a cash-out loan is 80% of that amount, or $240,000. If the current mortgage balance is $200,000, the remaining balance for cash-out is 40,000.
Frequently Asked Questions
When can I do a cash-out refinance of an FHA loan?
Generally, for an FHA cash-out refinancing, the applicant must be in the home for the 12 months leading up to application. The applicant must also be up to date on mortgage payments.
Are cash-out refinancing options available for investment properties?
For conventional loans, yes, cash-out refinancing options are available. For FHA and VA loans, the property must be the borrower’s primary residence.
What can I use the lump sum I receive at closing for?
Generally, there are no restrictions on how a borrower can use the funds received from a cash-out refinancing. Some of the most common uses are home improvements, repairs, paying off student loans, consolidating credit card debt, creating savings, or creating an emergency fund.
What are the drawbacks of a cash-out refinance?
The first, and probably most glaring drawback is that your mortgage balance will increase. This could also result in an increase in monthly payments. There are also closing costs associated with any type of refinancing.
Do cash-out loans require an appraisal?
Yes, generally a cash-out loan will require a new appraisal and a credit check on the borrower.
Is a cash-out refinancing the same as a home equity loan?
No, a home equity loan is an entirely new loan separate and apart from your original mortgage. Whereas, cash-out refinancing replaces your old mortgage with a new one.
Can I do a cash-out refinance on an FHA loan or a VA loan?
Yes, both FHA and VA-approved loans are eligible for cash-out refinancing.
Do I have to pay closing costs for cash-out refinancing?
Yes, as with most any refinancing of a mortgage, most cash-out refinancing situations will require closing costs to be paid at the time of closing. Some loans may allow for closing costs to be rolled into the loan balance.
Whatever your circumstances and whatever type of refinancing you may be interested in, Dynamic Funding is here to help. Contact one of the professional lending agents at (212) 364-7171 or fill out the contact form below.