California Cash Out Refinance
Cash Out Refinance
Refinance and take cash out of the equity in your home.
Low Interest Rates · Highest LTVs · Fast Loan Processing.
If you have equity in your home and are looking to take cash out we will help you explore what options exist to achieve your goals. We offer very competitive loan terms on cash out refinancing, which includes excellent rates and the highest LTVs.
People take cash out of their home for many reasons. It is very commonly used for debt consolidation or elimination, including pay off personal debts, credit cards, auto loans, and even student loans. Others cash out refinance to invest, purchase another property, finance home improvements, pay for college, use for emergency funds, or even go on a world cruise. You can use your money for whatever you want. Allow us to help you easily and affordably gain access to your home equity.
Types of Cash Out Refinance Programs:
- Conventional cash out refinance loans
- FHA cash out refinance loans
- VA cash out refinance loans
How do you know which is best program for you? The following overview of each loan type will help you determine which is the right loan for you. If you have questions or would like to get prequalified to compare your options, request a free consultation and a loan representative will call or email to assist you.
Conventional Cash-Out Refinance Loan:
The conventional cash out refinance loan is best suited for borrowers with great credit, and those that only need to cash out up to 80% of their homes equity. The 80% maximum loan-to-value rule is set by Fannie Mae guidelines. Therefore, no mortgage lenders offer conventional cash out loans that provide a higher LTV. One of the major advantages of conventional loans is that no PMI (private mortgage insurance) is required on loans with a 80% or lower LTV.
- Avoid PMI – The LTV restrictions are helpful in the sense that a loan is capped at 80% LTV, which means you do not have to pay any PMI (private mortgage insurance). This can save you thousands of dollars.
- Lowest Rates – Conventional cash out refinance loans generally offer lower rates than FHA loan than FHA. The combination of lower rates and avoiding paying mortgage insurance can save a borrower a lot of money, especially overtime.
Conventional loans are not as easy to qualify for as FHA loans.
- Credit Score – Conventional loans require an absolute minimum of a 620 credit score, but in some cases a 680 or higher score is required. These guidelines lead many people to take cash out with a FHA loan instead.
- Seasoning Requirements – The seasoning requirements for a conventional cash out refinance are that you must wait 6 months after you purchased your home to refinance and take cash out.
FHA Cash-Out Refinancing Loan:
FHA loans are ideal for borrowers who might not qualify for a conventional loan to tap into their equity, as well as those who want to take out as much cash as possible. FHA loans allow for 85% LTV, which conventional loans are limited to only 80%.
- Lenient on Credit – The credit qualification requirements through the FHA are more lenient and less documentation is required.
- Higher LTV – Another benefit is borrowers are allowed to take cash out up to 85% of its appraised value (85% LTV). To see how much cash you could take out based on the 85% LTV, use our FHA cash out calculator.
- Credit Score – A 620 credit score is required for any of our FHA loan programs. A 620 FICO score is considered “fair credit”. Any score that is 619 or below will not be eligible for an FHA cash out refinance.
- Seasoning Requirements – The FHA rule stipulate that the home must have been purchased at least one year prior to taking cash out. This is one area that a conventional loan beats out an FHA loan for cash out refinancing. If you purchase your home less than a year ago, you may want to consider a conventional cash out refinance which only requires a 6 month waiting period.
- Fixed Rates Only – There are only fixed rate mortgages, no adjustable rates are offered for FHA cash out refinances. Most prefer fixed mortgages rates over adjustable rate mortgages (ARM loans), so this should not be an issue for most borrowers. Most FHA cash out refinances are amortized for 30 years (although other amortization schedules are allowed depending on what your needs are). You have the option to choose a 15 year fixed as well.
VA Cash-Out Refinance Loan:
One of the greatest perks provided to veterans is the fact that they are eligible to apply for special home loans, which includes the best cash out refinance program available. The advantages of VA cash out loans are tremendous.
- 100% Cash Out LTV – Veterans can take 100% of their equity out of their home using a VA cash out refinance. This is a serious advantage over FHA (80% max LTV) and conventional (85% max LTV). Not all applicants will qualify for 100%, some are limited to 90%.
- Low Rates – There are special low rates for VA home loans.
- No PMI – VA loans do not require any mortgage insurance to be paid. This will save a veteran thousands of dollars over the life of the loan.
- Veteran or Active Duty – These special home loans are exclusively offered to veterans and active duty members of the military (also eligible spouses qualify).
- 100% Cash Out LTV – Veterans can take 100% of their equity out of their home using a VA cash out refinance.
- Low Rates – The rates on VA loans are lower than most others.
- No PMI – VA loans do not require any mortgage insurance to be paid.
To learn more about the VA cash out program, click here.
Which is the Right Loan For You?
Depending on how much cash out of your equity you need, what your current mortgage loan program is, and what your future goals are for your property, a loan specialist will advise you on the most advantageous loan program is for your situation.
Questions About Cash Out Refinancing
These are a few of the most common questions we are asked about cash out refinancing. We have a full page on cash out questions that covers more topics.
Are cash out refinance loans available for investment properties?
Cash out refinancing is available for investment properties, but exclusively on conventional loans. FHA and VA loans are not available for investment properties.
What are the loan limits for cash out refinances?
The loan limits on cash out mortgages are the same as other similar loan types. Conventional and VA cash out loans use the same conforming loan limits as a purchase or rate and term refinance. FHA loan limits are the same on all types of FHA loans.
What options exist for multifamily properties?
Any eligible multifamily property with 2-4 units that is owner occupied (meaning you occupy at least one of the units as your primary residence) can apply for a cash out refinance. As long as your property meets the conventional, FHA, or VA guidelines for a multifamily property, you can cash out refinance. The same LTV restrictions apply, however, the loan limits are higher (please reference the conforming or FHA loan limits for your county).
How long after a purchase can I cash out refinance?
After purchasing your home, you may refinance and take cash out after 6 months. This is known as the “seasoning requirements”. The appraisal is likely to be scrutinized more closely than usual, but assuming you purchased a home for much less than what it is worth, you may be able to cash out refinance after 6 months.