Refinance with Lending Circle
Cash-out Refinance is a do-over of existing mortgage with the goal of getting additional cash in hand. Your existing mortgage will be replaced with a new loan amount. You can determine a new loan amount by adding your existing mortgage balance, closing costs and the amount you’re looking to net from the loan proceeds. After the new loan amount is established, we will need to review your credit score and determine Gross Debt & total Debt Ratios with your income . These factors decide whether you can qualify for the new home loan with a prime lender(A Lenders), subprime lender(B Lenders) or Private Lenders.
Reasons for Cash Out Refinance
- Debt Consolidation
- Business Capital
- Home Improvements & Renovations
- Downpayment for Cottage or Rental Property
- Helping a Family Member
Things to Consider
- Credit Score: If your credit score does not meet the minimum beacon score guidelines of Prime lender then you may need to refinance with a Sub Prime or Private Lender. Therefore, the new rate may be higher than your previous that may increase your monthly payment.
- GDS/TDS: Your Income determines GDS/TDS and you must fit the required ratio guidelines for A or B Lender. B Lenders are more flexible with GDS/TDS guidelines but offer higher rates than Prime Lenders.
- Market Rates: The rates are always changing in the mortgage industry. What kind of rate will you qualify for a new mortgage is major factor. If the market rates are higher than your existing then you must factor in the difference in monthly cost based on the new rate.
- Mortgage Penalties: It may cost you to break your existing mortgage if you are paying out during the term of the mortgage. It is important to factor in any penalties to the closing costs.
How can Lending Circle help?
We can quickly help you determine if Cash out Refinance makes sense for you. Our goal is to get you cash in hand while minimizing the added cost. During the initial consultation, we can review your credit score, income & GDS/TDS ratios advise you of the best options. There are other ways to access cash in hand with home equity products, such as home equity loan & HELOC if cost for cash-out Refinance doesn’t make sense. We ensure that you get the cash you need with the lowest rate for your home loan.
