Have you been dealing with unexpected expenses or looking to consolidate debt? Refinancing your mortgage could be the solution to getting a quick cash injection as a cash-out refinance approach. Refinance loans let you swap your current mortgage for a new, higher loan amount. The difference between your new and old loan values gets paid out to you in cash!
Beyond just getting your hands on money fast, refinance loans come with some other pretty awesome benefits. Keep reading to see why refinancing is one of the best ways for homeowners to access large sums of cash in a jiffy.
Unlock Your Home’s Equity
Home equity is the current market value of your home minus any existing mortgage debt you still owe. Every monthly mortgage payment you make increases the amount of equity you own. A cash-out refinance loan allows you to tap into some of that built-up home equity and walk away with cold, hard cash!
Let’s say your home is worth $300,000, and you still owe $175,000 on your original mortgage. With a refinance loan, you could take out a new mortgage for $225,000 while paying off the $175,000 you owed. The difference of $50,000 gets paid out to you at closing!
Get Cash for Any Purpose
Old mortgages are very restrictive in how the money has to be used; you can’t just take the loan amount and splurge on stuff you want. But with a refinance cash-out, the money is yours to spend however you choose! All debt-free! Some of the most common reasons people refinance for cash include:
- Paying off high-interest credit cards or other loans
- Covering major home repairs or renovations
- Funding a child’s college tuition or wedding
- Capitalizing on investment opportunities
- Covering moving or relocation costs
Having access to a huge lump sum of cash can give you the financial flexibility to tackle any big expenses with ease. It sure beats trying to scrimp and save up over months or years!
Take Advantage of Better Interest Rates
Refinancing to a lower interest rate is one of the top motivations for homeowners pursuing new mortgage loans. Even seemingly small interest rate reductions can add up to massive savings over 15-30-year mortgage terms.
For example, refinancing from 5% down to 4% interest on a $250,000 mortgage can save you nearly $50,000 in interest charges over 30 years! Those monthly savings effectively help pay for any cash taken out.
Additionally, many cash-out refinance options allow you to simultaneously change your mortgage term length, such as switching from a 30-year to a 15-year mortgage. This flexibility lets you optimize your payments to suit your needs.
The Refinance Process Is Quick and Easy
What is the major advantage of refinance loans compared to getting separate cash loans or home equity lines of credit? The entire process is fast and straightforward! Instead of having to apply for multiple new loans or credit lines, refinancing simply replaces your existing mortgage—no added applications are required. Since the property has already been evaluated, most refinance loans can be processed within 30-45 days.
Competitive lenders also provide preapprovals in as little as a couple of days, so you can get started quickly. In many cases, closing costs for refinancing are minimal or can even be rolled into the new loan amount, too!
Unlock the potential of your property with Hard Money Georgia‘s tailored refinance solutions. Experience the ease of accessing quick cash for renovations, debt consolidation, and more from our team. Don’t miss out—contact us to start your streamlined refinance journey today!