Whether you’re looking to make expensive home improvements, pay off some debt, or just need some cash for personal reasons, cash-out refinancing can be a great option for many people. Below you’ll find more information on cash-out refinancing and how it can help you.
What is Cash-Out Refinancing?
Bankrate defines cash-out refinancing as, “A cash-out refinance is when you refinance your mortgage for more than you owe and take the difference in cash.” Popular home buying and selling site Zillow explains this in an easy to understand way, “Let’s say you own a $300,000 house and still owe $200,000 on the current mortgage. (This means you’ve built up $100,000 in equity – a fancy word for ownership). Now let’s say you want some extra cash to the tune of $30,000. You could do a cash-out refinance to get this money. If you did this, you’d get a new loan worth a total of $230,000 (the $200,000 you still owe on your home, plus the $30,000 you’re going to take out in cash).”
What Can I Use the Cash For?
There are little, if any, restrictions on what you do with the cash once you’ve refinanced your home. With that said, there are smarter things to spend your cash on that what some people may choose. One of the most popular things people spend it on is a major home renovation project, such as redoing their kitchen or finishing a basement. Many other people also use the cash to pay off credit card debt. This can even improve your credit score because you’re putting the money towards paying off credit cards you owe money on. This can also help you get a tax benefit when you move your credit card debt to mortgage debt because you can deduct mortgage interest on your taxes.
If you’re wondering if you’re eligible for a cash-out to refinance or want to see if it’s the best move for you, contact the experts at Pacor Mortgage. We can help you assess your situation and see if a cash-out refinance is right for you. Give us a call at 773-881-7744 to set up an appointment, or visit our website to learn more about refinancing with Pacor Mortgage.
2018 Pacor Mortgage Corp. Pacor Mortgage Corp is located at 14930 S Cicero Ave, Oak Forest, IL 60452, Phone 773-881-7744 (Unique Identifier #120945). Pacor Mortgage Corp is an equal housing lender and is licensed by the Secretary of State under the Illinois Residential Mortgage Lending Act and is assigned Illinois Residential Mortgage License MB.0000892. Pacor Mortgage Corp branches operate with the following licenses and is assigned Illinois Residential Mortgage License MB.0000892-001, with a Wisconsin License # 260345BA, Palos Heights NMLS 261297 and is assigned Illinois Residential Mortgage License MB.0000892-008, Indiana DFI 13177, Wisconsin 120945BA, Michigan FL0828, Michigan SR1130, Florida, Pennsylvania 43855, Colorado, California, Kalamazoo, MI NMLS 120945 also DBA Lake Pacor Home Mortgage, Westlake, Ohio DBA US Lending Corp MB.804151.000. This is not an offer for an extension of credit, a rate lock or a commitment to lend. All loans must satisfy company underwriting guidelines and any investor overlays. Any of the advertised products may be discontinued at any time. Information and pricing are subject to change at any time and without notice. Loans are being committed and closed at expressed rates although these rates change and may not be available at time of your lock in, commitment and / or closing. Pacor Mortgage Corp is not affiliated with your current lender, nor is it an agency or extension of the Federal Government, Fannie Mae, Freddie Mac or HUD.