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Cash_Out_Refinancing_-_A_Few_Things_To_Know_About_Cash_Out_Refinance

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					Cash Out Refinancing - A Few Things To Know About Cash Out Refinance

Word Count:
320

Summary:
There’s no doubt you have been inundated via e-mail, postal mail or even
phone calls from lenders trying to convince you to cash out the equity in
your home. The reasons for a cash out refinance are endless--debt
consolidation, better rate/term, lower monthly payment, home
improvements, college education financing, etc. One commonly overlooked
reason to cash out equity in your home is that you may possibly find that
$10,000 could earn you more money if it’s invested wisely. D...


Keywords:
cash-out mortgage refinance


Article Body:
There’s no doubt you have been inundated via e-mail, postal mail or even
phone calls from lenders trying to convince you to cash out the equity in
your home. The reasons for a cash out refinance are endless--debt
consolidation, better rate/term, lower monthly payment, home
improvements, college education financing, etc. One commonly overlooked
reason to cash out equity in your home is that you may possibly find that
$10,000 could earn you more money if it’s invested wisely. Don’t forget
that mortgage interest is tax-deductible (up to 100% of the value of your
home). You can even now pull 125% of the equity/value of your home with
average and better credit (usually a FICO score of 640+).

The most important thing to think about in pursuing a cash out refinance
is what you will do with the cash you’re getting. What are your short and
long-term economic goals? How long do you plan to be in your house?
Secondly, are you getting the best deal? What are the fees associated
with initiating the loan and what will your monthly payment be? Most
origination fees are “rolled into” the loan, meaning they will be
subtracted from the total loan amount after paying off your other
mortgage(s) and debts.

Many lenders see cash out refinances as a slightly higher risk than a
rate/term refinance mortgage and may adjust the rate accordingly, so find
out what that premium is costing you. Also keep in mind that when you
originate a new loan, you are starting with an entirely new term. If
you’ve been paying on a 30-year mortgage for a few years, you may be
beginning another 30-year mortgage. See if a shorter term (e.g. 15-20
years) is affordable for you.

Most importantly, do your research. Compare lenders and loan offers. Make
sure that you are getting the best rate and the best deal for your
situation.