I was a dad in need of some quick cash to help pay for my son’s education. I had been a self made handy man for my entire adult life. Though I was successful, my son had worked hard in High School to put himself in position to go to a school of his choice. Even with the limited scholarships and federal grants he received I still was on the hook for a fortune in tuition. That summer before he left for college I learned about cash out mortgage refinancing.
Let’s discuss cash out refinancing
So what is cash out refinancing anyway? This is when a homeowner replaces their current mortgage with the maximum amount you can be allowed to borrow against your home. The extra cash that you receive is based on the equity you've built up in the home when you close on the loan. This money can be used for whatever you want. I chose to invest in my son’s education; however I learned that many other people use it for a variety of reasons.
- Medical Expenses or Emergency funds.
- Home Improvements, Repairs, or Additions
- Personal Luxuries like a Family Vacation
- Starting a Small business or even Purchasing a Second Home
I had been paying fixed rate mortgages for years and had built up some considerable equity. I didn't even know that this money could be accessible as a homeowner. Equity is an interesting financial option because you can even take out a line of credit against this equity which is tax deductible. The thing to consider is whether it is worth it for you or not because it will set you back on your goal for paying off the mortgage entirely. Most likely the terms of your mortgage will need to be extended. This can be a good thing if the investment is the right one.
You've come this far
If you were financially able to own a home with mortgage payments then you have already built up some equity. Most likely you have a number floating in your head right now about how much you've paid off on the total value of the home. Remember that because you partially own the home with the money you have invested, it might be possible through cash out mortgage refinancing or a home equity line of credit to make substantial investments in other areas of your life.
How will you invest?
What will you do with your money? Are you struggling with debt? You could use cash out refinancing to increase your cash flow and reserves to help consolidate a debt with high interest into one monthly payment. Remember that FHA mortgage refinance loans secured by your home tend to have lower interest rates, so your payments will help to improve a credit score rapidly. These options have helped countless people reorganize and manage their finances.
I wouldn't have learned about cash out refinancing if I hadn't found the website www.Real-Estate-Yogi.com. They are experts on everything involving real estate and have access to help all across the country. You can call them toll free to speak with a representative at 1-800-987-1397 any day of the week.