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Cash-out Mortgage Refinancing: Pros and Cons

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Point of Interest

Cash-out refinancing allows you to convert the equity in your home to a lump sum of cash by extending your mortgage. 

A cash-out refinance can help fund major expenses that would otherwise take years of saving. Here are the pros and cons of a cash-out refinance.

A cash-out refinance allows homeowners to use their home equity for immediate access to cash, tax-free! It can be an excellent option for homeowners looking for ways to fund a large purchase like a renovation. 

Historically, refinancing activity picks up when interest rates fall. In response to historically low-interest rates, the average 30-year fixed-rate mortgage has fallen from 3.77% to 3.02% year-over-year (as of July 2020), leading many homeowners to refinance their mortgage. According to CoreLogic, refinance loan originations increased by 59% in 2019.

Interest rates are expected to remain low for the foreseeable future. If you bought your home in

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