Cash out refinance pays off your existing first mortgage. These results in a new mortgage loan which may have different terms than your original loan. It will result in a new payment amortization schedule, which shows the monthly payments you need to make in order to pay off the mortgage principal and interest by the end of the loan term.
Cash-out refinancing options are available to qualified homeowners with more than 20% equity in their homes.
The FHA cash-out refinance option allows homeowners to pay off their existing mortgage, and create a larger home loan that provides them with extra cash.
If you are a US veteran or an active service member, choosing a VA Cash-Out Refinance often allows you to use even more equity from your loan.
Don’t have 20% for a down payment? This doesn’t mean that purchasing a home is out of reach. Realty Mortgage has a variety of loan programs available with low down payment options.
Similar to when you applied for your original mortgage, you will be required to provide all of the necessary documents to prove your borrowing worthiness and you will be responsible for closing costs, though you may have the option to roll some costs into your loan amount.