Refinancing

Learn about Cash-Out Refinancing.

What is a Cash-Out Refinance?

A cash-out refinance is a type of mortgage refinance that takes advantage of the equity
you’ve built over time and gives you cash in exchange for taking on a larger mortgage. In a more simple way of saying, you borrow more than you owe on your mortgage and pocket the difference.

You can gain equity in two ways:

  1. Your home increases in value.
  2. You pay down your mortgage principal through your monthly mortgage payments. Every time you make a payment, you gain a bit more equity in your home.

How Much Cash Can You Get On A Cash-Out Refinance?

The amount you earn on your refinance usually depends on your home’s value. Before
finding out how much you qualify for, you’ll need to have your home appraised. Lenders will normally let you draw out no more than 80% of your home’s value, this can vary from certain places and different circumstances. So be sure to ask your lender about this.

Academy Mortgage Yuma - Cash Out Refinance

Reasons To Consider A Cash-Out Refinance

  • Fund Home Improvements and Renovations
  • Consolidate Debt
  • Get a lower Rate
  • Free Up Money For an Investment Property

Just like applying for your initial loan, you’ll need to meet your lender’s standards before
you can qualify.

  • Credit score. Refinances have a minimum credit score requirement that can vary by the loan type. Give your lender a call and ask what loan programs you qualify for, and what your best option is.
  • Home equity. Your home equity is the percentage of the loan principal you have
    paid off. It is a good idea to wait to refinance until you have at least 20% equity in your home. It’s possible to refinance with a lower percentage, but you won’t have access to the most favorable interest rates. Your lender can help you with this.
  • Debt-to-income ratio (DTI). Lenders have to consider your DTI ratio. Your lender will figure this out based on payments shown on your credit score VS your gross income. Lenders must have you under 50% DTI to consider continuing with a refinance.
  • Closing costs. That’s right! Just like buying your home, there are closing costs. This can usually equal 2-5% of the principal balance. Ask your lender for an idea of what this number will be. They can give you a cost breakdown sheet.

Please be sure to provide:

  • ID(s)
  • 1 Month of Paystubs
  • 2 Months of Bank Statements
  • 2 most recent W-2s / 1099’s
  • Any other documentation your lender may ask for (Especially if you are self-employed)

I have more questions!

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Contact a loan officer today, and we can help you break it down to see if this is a good option for you!

Brian Aungst

Loan Officer

NMLS: 2031470

State Lic: LO-1038828

PHONE: (928) 514-1592

Ray Ochoa

Senior Loan Officer

NMLS 214114

State Lic: AZ LO-0915882, TN 238287

PHONE: (928)246-5937

PHONE: (928) 247-9089

Academy Mortgage Yuma - Robert Wright

Robert Wright

Loan Officer

NMLS# 1989817

State Lic: LO-1012538

PHONE: (928) 247-9089 X33917

PHONE: (928) 366-1637

Brenda Hurtado

Loan Officer

NMLS: 2333849

State Lic: LO-1039337

PHONE: (928) 304-3183

Bill Craft

Sales Manager

NMLS 1621885

State Lic: LO-0942496

PHONE: (928)366-1639

PHONE: (928) 247-9089

Derek Egeberg

Branch Manager

NMLS 180899

State Lic: AZ LO-0915245, TN 236104

PHONE: (928)246-0422

PHONE: (928) 247-9089

Rosa Castillo

Senior Loan Officer

NMLS# 799138

State Lic: LO-0944489

PHONE: (928)920-2831

PHONE: (928) 247-9089

Corey Seward

Corey Seward

Loan Officer

NMLS: 2137785

State Lic: LO-1026723

PHONE: (928) 247-9089 x33935

I Want to Refinance!

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