| There are some definite benefits to doing a cash out | | | | longer than the term of the rest of your mortgage loan |
| refinance. Just make sure that overall you are not | | | | On the other hand if you are: |
| going to be spending more money in fees and interest | | | | 1. Going to refinance anyway 2. Wanting to borrow a |
| doing a cash out refinance as opposed to a home | | | | large percentage of your home’s equity 3. |
| equity loan. When you do a cash out refinance, you | | | | Refinancing for a much lower rate |
| are refinancing your entire loan. Let's say you owe | | | | Then, a cash out refinance loan may be best for you. |
| $300,000 on your home and you want to get $10,000 | | | | Of course, the best way to tell is to actually sit down |
| in cash out. If in refinancing your rate will be the same | | | | and do the math. These are just guidelines; the real |
| or higher, then you will be losing an extraordinary | | | | test is in the math. You can consult a refinance |
| amount of money in fees just to get a $10,000 loan. In | | | | calculator and a home equity loan calculator and figure |
| a case like that, you would definitely want to go with a | | | | out which one will save you the most money in the |
| home equity loan. | | | | long run. Compare the total amounts you will spend in |
| Home equity loans are better if: | | | | interest and fees. If you are planning on a cash out |
| 1. You have a large home loan yet only need to cash | | | | refinance, make sure that you are refinancing with a |
| out of a small amount of equity 2. You need to borrow | | | | low enough rate to justify the fees to refinance. Your |
| up to 100% of the equity in your home 3. You want a | | | | loan specialist should be able to help you figure out |
| revolving credit line 4. You want a payoff sooner, or | | | | which one is best for your needs. |