A cash-out refinance lets you swap your existing mortgage for a new one with potentially better rates or better terms. You get the difference between the two loans in cash generated from your home's equity.
Use your equity however you like — home improvements, debt consolidation, college tuition, a new car. Seriously, it’s up to you. It’s your equity.
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If you’re in the refinance season of homeownership and want to take advantage of your home’s equity for things like emergencies, home renovations or college tuition payments, Wyndham Capital Mortgage’s cash-out refinance may be your ticket.
What Is a Cash-Out Refinance?
A cash-out refinance allows homeowners to refinance their home (paying off their original mortgage loan) and collect their home’s equity in the form of cold, hard cash. Often, borrowers choose cash-out refinancing to consolidate debts, pay for their child’s college tuition, buy a new car or finally make those home improvements.
Cash-Out Refinance Rates & Terms
Cash-out refinancing can help borrowers get into a new mortgage loan with a better interest rate or lower term depending on their needs.
30-Year Term Cash-Out Refinance Rates
A popular refinance option is the 30-year term cash-out refinance because it puts cash in your hand while keeping your monthly mortgage payment low. A 30-year cash-out refinance also comes with lower interest rates than other options.
20-Year Term Cash-Out Refinance Rates
A 20-year term cash-out refinance is the happy medium option. It still puts money in your pocket but offers a shorter loan term than 30 years. This means you can pay off your home loan sooner without drastically changing your interest rate or monthly payment.
15-Year Term Cash-Out Refinance Rates
For those looking to crack down on the length of their mortgage loan, a 15-year term cash-out refinance means you’ll be paying the loan off in half the time of a 30-year mortgage loan and at a higher monthly payment amount while being able to use your home’s equity for a variety of reasons. A 15-year cash-out refinance typically comes with lower interest rates, which makes this option worth it for some.
Benefits of a Cash-Out Refinance
Depending upon your personal financial situation, there are several benefits to a cash-out refinance. Lowering your current interest rate can save you money. Plus, a cash-out refinance allows a homeowner to turn their hard-earned equity into cash.
Cash-Out Refinance Rates: Frequently Asked Questions
How do I get competitive cash-out refinance rates?
Cash-out refinance rates vary based on the type of refinance term you choose. Traditionally, 30-year mortgage and refinance rates will have a higher interest rate than 20 and 15-year term options. Refinance rates will also depend on the borrowers’ financials like credit score and income.
How much can I cash-out when I refinance?
The amount of money you can cash-out for a refinance depends on the guidelines set by your mortgage company. Typically, you can take out 80 percent of your home’s current equity.
Do I have to pay closing costs on a cash-out refinance?
Yes. Just as with your original home loan, you are responsible for paying closing costs on your refinance loan.
Who should utilize a cash-out refinance option?
Anyone who wants to leverage their home’s equity and use it for things like home repairs or additions may want to utilize a cash-out refinance. Whether it be because of a situation that leaves you needing cash or a long list of home improvements you want to make, cash-out refinancing can allow you to take use your hard-earned equity.
What’s the difference between a cash-out and streamline refinance?
A cash-out refinance allows you to use your home’s equity and revise your current home loan. A streamline refinance replaces your current mortgage with a new one. The principal balance stays the same although the interest rate and loan length can change.
How do I get started?
Speak with a Wyndham Capital Mortgage expert loan officer to discuss the current cash-out refinance rates, review your refinancing options and see if a cash-out refinance is right for you.