Refinancing to Get Cash

The most common refinance is to get cash to consolidate bills. Consumers do this to lower their total payments, take advantage of lower rates on home loans as opposed to higher rates on credit cards or auto loans, possible tax benefits, pay off everything including the house faster and many other personal reasons. You can get cash for any purpose you want, including home improvement, cars, boats or RV purchases, investments, family needs such as college tuition and anything else for which cash is needed. For years, the common 30-year fixed first mortgage has allowed you to borrow up to 80% of the appraised value for the refinance loan amount, pay off your existing mortgages and costs and keep the cash difference. Now there are loan programs that go to 90% of the appraisal at slightly higher rates and even 100% of the appraisal at even higher rates. If you are looking to get a lot of cash and are considering the 90% or 100% program, be sure to compare the payments against the extra cash. You may find the 80% of the appraisal loan amount is a better value for what you want and still leaves you spare equity if needed at a later time.

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