Eugene Mortgage News

What is a Cash-Out Refinance?

March 16th, 2018 1:28 PM by Mike Herborn

A cash-out refinance is the process of replacing your old mortgage with a new mortgage of a larger amount and receiving the difference of the amount in cash. Cash-out refinances are a great option if you have equity in your home and you need cash for certain expenses. Home equity increases when you pay down your loan balance and can also increase if your home gains value due to a healthy real estate market or home improvements. There are many uses of the cash from a cash-out refinance but here are some of the most typical uses:

1. Paying off high interest debt from credit cards
Paying off high interest debt from credit cards can end up saving you hundred and possibly thousands of dollars a month while also reducing your overall debt.

2. Paying off student loans 

Paying off the debt from student loans can also lower monthly payments and reduce your overall debt. 

3. Remodeling your home

Home improvements can be quite expensive and difficult for most people to fund. When you take cash out, you can fund the needed or wanted repairs in your home. 

4. Use for college funds 
If either yourself or a family member of yours needs the funds to go to college, a cash-out refinance can be a great option for you to receive such funds. 

5. Use toward the purchase of an investment (rental) property

The cash you receive back from your primary residence cash-out refinance can be applied towards the purchase of an investment property. 

Cash-out refinances can be a wonderful tool. To find out if a cash-out refinance is something that would benefit you and your needs, contact us at 541-683-3300! 

Posted in:General
Posted by Mike Herborn on March 16th, 2018 1:28 PM