What Are the Top 5 Reasons To Get a Cash Out Refinance on Your Mortgage? The Expert Loan Officers at Goldwater Bank Weigh in - Opinion Article

Top 5 Reasons For a Cash Out Refinance

The mortgage experts from Goldwater Bank weigh in

Mortgage interest rates are still at historic lows, and many people may not realize that lowering your monthly payment isn't the only big advantage to consider when it comes to refinancing. One of the more common refinance goals for many of our borrowers is the cash-out refinance. This is done when we can use the positive equity in your home, and refinance your loan for an amount higher than what you owe on your principal balance. The additional amount above what you owe will be given to you as cash at closing time. What you choose to utilize that money for is your business - of course our underwriters will probably want to know - but here are some of the most frequent reasons we come across at Goldwater Bank: 

1. Consolidating Debt: This is arguably the most common cash-out refinance that we come across because it makes a lot of sense for anyone with debt. You might be able to use the cash from your equity to pay off your credit cards, auto loans, or other debts - usually at a much lower interest rate than what they would have been on their own; and simplify your life by combining them into one easy monthly payment. 
2. Add an Addition or ADU to Your Home: Another common reason for people to pull cash out of their refinance is so that they can expand their living space. This could include adding a sunroom, garage, or other room that you've desired; or, it could even be used to expand a master suite to include a walk-in closet and/or office space. Another popular option trending right now is the ADU (accessory dwelling unit) which could serve as a she-shed, granny flat or other livable space that has the potential to generate monthly income and/or add value to your property. 
3. Remodel Your Kitchen or Bathroom: Remodeling your kitchen or bathroom with the cash you pull out during your mortgage refinance is always a great option as well. This can help you to live more comfortable with the kitchen of your dreams, finally creating the extra counter space that you crave; but it's also a wise choice because it could immediately increase the value of your home. 
4. Put in a Pool or Patio: If you've always dreamed of having your own pool that's the talk-of-the-town; or a charming outdoor space to sit and relax while enjoying cocktails with a few friends then a cash-out refinance on your mortgage may be a great solution for you to make it a reality.  
5. Invest in Your Education: The final most common way to use that cash is to turn around and invest in your own education. By pursuing advanced or continued education you're setting yourself up to be even more successful in your career path which will ultimately increase your financial outlook. 

These were just a handful of the ways that you can use a cash out refinance on your mortgage to your advantage. Keep in mind that when you refinance, you don't always have to "start over" by going back up to a 30 year term. On the contrary, sometimes people get into a shorter term than their current length so that they can pay their mortgage off more quickly. You also may not need to come with any out-of-pocket expenses if we're able to roll those into the cost of the loan. If you're unsure of your options or what you could even qualify for, give one of our loan officers a call and we'd be happy to help you if we can, or part ways as friends if we cannot. (440) 673-3323

Goldwater Bank, N.A. - Mortgage Division Corporate NMLS# 452955 8223 E Washington St., Unit 3 & 4, Chagrin Falls, OH 44023 Office: 440-468-6920 | Mobile: 440-673-3323 Email: sean.sullivan@goldwaterbank.com | Website: www.ClevelandStas.com Goldwater Bank, N.A. - Mortgage Division NMLS# 452955 All rates and programs subject to change without notice. Goldwater Bank, N.A. is an equal opportunity lender.