You may have already heard, but rates are on the rise. However, historically rates are still quite low. For those of you that are homeowners, now is an opportunity to refinance before it’s too late! Equity has skyrocketed and can be a huge benefit to those looking to refinance.
Here is what the experts are predicting for the housing marketing in 2022
If you have an existing mortgage, now is the opportune time to take advantage of a refinance before rates go up.
What is a Cash Out Refinance?
A Cash Out Refinance is a type of mortgage loan that allows you to tap into your equity. Long story short, you take out a larger loan (using the equity in your home), borrowing more than you owe on your mortgage, and take home the difference.
Experian provides a great example of how this scenario could work: Let’s say you have a $250,000 mortgage balance on a home worth $400,000. You need $20,000 to cover the cost of some home renovations, so with a cash-out refinance loan, you replace your $250,000 loan with a $270,000 loan and receive the $20,000 difference in cash.
What’s the strategy behind a cash-out refinance? That’s up to you! You could…
• Consolidate / Pay Off Debt
• Eliminate High Rate Credit Card Debt
• Fund A Home Renovation
• Finance Education
• Invest (Portfolio, Rental Properties)
… and much more!
Not only can equity benefit you in terms of a refinance, but it can be a great tool to have on your side if you are looking to move to a larger home or change locations.
How Rising Equity Impacts You
If you’re already a homeowner, equity not only builds your wealth, it also opens doors for you to achieve your goals. It works like this: when you sell your house, the equity you built up comes back to you in the sale. You can use those proceeds to fuel your next move, especially if you’ve decided your needs have changed and you’re looking for something new.
With rates on the rise, there is no better time to refinance than now, especially with significantly high equity. Use our interactive calculator to see how a refinance can benefit you, and let’s have a chat today!