Cash out REFINANCE
Real Estate Funding Solutions guarantees clients the best and lowest mortgage terms in the real estate market especially for non-owner occupied properties or investment properties with long term rental agreement. If you already obtained a term sheet from another lender for your Cash Out Refinance deal, please feel free to email over the existing term sheet along with a copy of the appraisal report so that we can beat your current offer with better terms.
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Cash Out Refinance is one type of real estate financing options where borrowers replace their current mortgage product with a new mortgage for the purpose of cashing out the remaining balance of the old mortgage once paid off by the new mortgage at closing.
Real estate investors make money on refinancing by taking advantage of lower interest rates or increased property value to secure a new loan, paying off the existing one, and pocketing the difference in cash or using it to fund other investments.
Cash Out refinance is a process where homeowners are able to cash out the equity of the property, which is the difference between the current value of the property minus the amount owed on the mortgage.
Cash Out Refinance may be very beneficial in scenarios where property value is much more than the amount owed on the mortgage. This process is very common with real estate investors where they can leverage their capital by using the funds from their property equity to invest in buying more real estate.
The process of Cash Out Refinance transactions is only possible if the value of the subject property has gone up since the purchase transaction of the same property has been completed, which allows the property owner to cash out the difference in equity since the property value is much higher than before.
Once the underwriting process has been completed, borrowers typically receive the funds via wire within 24 hours of closing date.
It is possible based on the market competition as well as the amount of cash flow generated from the property.
Borrowers can typically cash out 70% of the property value on investment properties or properties that are non-owner occupied and 80% LTV on primary residence properties or properties that are owner occupied. Although these numbers may vary based on the lender as well as other factors pertaining to borrowers.