Can You Refinance a Home That is Already Paid Off?
Cash Out Question
Can you refinance a fully paid off home?
One of the most common questions that people ask about cash out refinancing is:
Can I refinance my house that is already fully paid for?
Absolutely. If your house is already fully paid for and you wish to take cash out you may do so if you meet the qualy. It does not matter how long it has been, or even if you have ever had a mortgage on it. As long as you qualify you can cash out. Assuming you are not in an agricultural property, or are a veteran, than you likely will qualify for up to 80% or 85% of your home’s equity. These numbers represent a conventional or FHA cash out loan.
If 80% or less of your home equity is sufficient for the cash you need, it is advisable to refinance with a conventional loan. This way you can avoid paying mortgage insurance which is required on all home loans that exceed an LTV of 80%.
More importantly you should be asking yourself::
“should I refinance my house that is fully paid for”.
You should thoroughly consider the newly introduced mortgage payment. Even though you may be sitting on a considerably large sum of money after cashing out, that money may disperse quicker than you anticipate. Make sure you are realistic about the continuous responsibility of paying for a mortgage that you may be signing for 30 or 15 years. With a home that is already paid for in full you may want to limit how much cash you take out resulting in a smaller mortgage payment. That is only for you to decide and exclusively your prerogative though.
If you would like to see what you can qualify for and compare your cash out refinance options, contact us today and speak with a loan representative. Our cash out refinance loans are popular for their low interest rates and fast processing. Many refinances are completed in less than two weeks, and only require basic documentation such as credit, income, and an appraisal.