Cash-Out Refinance Home Mortgage Guidelines For Homeowners

This Article Is About The Cash-Out Refinance Home Mortgage Guidelines For Homeowners

Over the past few years, the prices of homes have gone up.

  • Never in the history of the U.S. housing market since prior to the housing bubble of 2008 has home prices been increasing like it has the past seven years
  • Both HUD and the Federal Housing Finance Agency (FHFA) have increased FHA and Conforming Loan Limits for the past five years due to skyrocketing home prices
  • Many homeowners are enjoying the rapidly growing equity in their homes
  • Cash-out refinances mortgages are becoming very popular due to the phenomenal skyrocketing values of homes

With historic record low mortgage rates, home prices seem to be on the rise with no signs of a correction.

Benefits Of Cash-Out Refinance Mortgages

This gives mortgage borrowers a few options.

  • First homeowners can do Cash-Out Refinance Home Mortgage to fix up their homes
  • Homeowners can do anything they want with proceeds from Cash-Out Refinance Home Mortgage
  • Updating kitchens and bathrooms are what most homeowners dream of doing
  • This is where owners get the most value for how much they spend
  • So if the value of the home is worth $200,000 right now and do a cash-out refinance to get $30,000 to fix up the house, the home could be worth $250,000 as soon as the repairs are done
  • Maybe more
  • Plus homeowners can enjoy living in what feels like a new house

In this article, we will discuss and cover Cash-Out Refinance Home Mortgage Guidelines For Homeowners.

Monthly Housing Payments After Cash-Out Refinance Home Mortgage

What are the guidelines for paying cash at home? Mortgages for homeowners

Having a larger home loan balance will increase homeowners’ monthly housing payments. This additional $30,000 will cost borrowers an additional $200 more a month:

Second, can do Cash-Out Refinance to consolidate consumer debts and bills.

  • Let’s say a homeowner has $50,000 of credit card debt
  • Ouch
  • Consumers are paying at least $1,500 a month on this debt
  • We all know it is so difficult to get out of credit card debt due to the high-interest rates
  • So take advantage of these higher home prices and doing a  Cash-Out Refinance of $50,000
  • This extra $50,000 increase of mortgage balance will only cost borrowers $270 a month versus the $1,500 they are paying
  • Imagine freeing up $1,230 a month

Many homeowners do not realize how much their homes have appreciated during the past several years.

Cash-Out Guidelines On Loan Programs

In order to qualify for Cash-Out Refinance, homeowners need equity in their homes.

  • Home prices have skyrocketed nationwide
  • Many homeowners who purchased their homes a few years ago have their homes appreciated double-digit equity
  • Many areas of California, Texas, Florida, Indiana, Pennsylvania, Georgia, New Jersey, Colorado, Michigan, Kentucky, Mississippi, Illinois have home values appreciating double digits every year since 2012
  • All loan programs have the maximum Cash-Out Guidelines with regards to debt to income ratios

The Federal Housing Finance Agency (FHFA) and HUD have increased maximum loan limits for five years in a row.

Loan To Value Requirements On Cash-Out Refinance

Cash-Out Refinance Home Mortgage
Gustan Cho Associates

Here is the maximum loan to value allowed per mortgage programs:

  • HUD cash-out refinance agency guidelines were lowered last year from 85% to 80% loan to value on FHA Loans
  • The decrease of loan to value on FHA loans was due to the skyrocketing home values nationwide
  • USDA does not allow Cash-Out Refinance Home Mortgage Loans
  • However, homeowners with a current USDA Loan can refinance their loan to Cash-Out Refinance Home Mortgage with FHA, VA, Conventional Loans
  • VA  lowered the maximum loan to value on cash-out refinance mortgages from 100% LTV to 90% on VA loans
  • As HUD, the VA lowered the loan to value on cash-out refinance mortgages due to concerns of skyrocketing home values

Fannie Mae and Freddie Mac allow up to 80% loan to value cash-out refinance on conventional loans.

Qualifying For A Cash-Out Refinance Home Mortgage With A Lender With No Lender Overlays

Gustan Cho Associates offers non-QM loans. There is no waiting period after a housing event and/or bankruptcy with non-QM loans. We also offer bank statement loans for self-employed borrowers. There is no mortgage insurance required on non-QM and bank statement loans. There is no maximum loan limit on non-QM and bank statement loans. Homeowners can do cash-out refinance home mortgages with non-QM and bank statement loans for self-employed borrowers. Gustan Cho Associates Mortgage Group has a national reputation of not having any overlays on government and conventional loans.

Contact us at Gustan Cho Associates at 262-716-8151 or text us for a faster response. Or email us at gcho@gustancho.com. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.

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