Three Options to Use the Equity In Your Home

Three Options to Use the Equity In Your Home

There are numerous benefits to owning your own home. Not only does it provide a place to live, but it can also provide a source of funds. Over time, most homes increase in value, and many homeowners use their gains for a whole host of purposes. Using your home’s equity can be a low cost source of funds. With so many factors to consider it’s important to know your choices so you can make the most of your home.

Refinancing to get cash out

With a cash-out refinance, you refinance your existing mortgage and also borrow an additional sum from your equity at the same time, giving you cash that you can use for whatever you want. There is also potential to combine a cash-out refinance with getting a lower payment or interest rate. How much you can refinance for depends on the value of your house and the lender’s maximum allowed loan-to-value (LTV) ratio. The LTV ratio is the percentage of the home’s value that is financed. Continue reading Three Options to Use the Equity In Your Home