HELOC or cash out refinance? | What To Know!
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- เผยแพร่เมื่อ 20 มิ.ย. 2024
- In this video, I discuss whether you should get a HELOC (home equity line of credit) or a cash-out refinance. There are many different scenarios and so it's really advised to talk to a mortgage professional about your specific needs and goals. As a mortgage broker, I have this conversation multiple times per week so I have experience with all kinds of scenarios. A local loan officer/loan originator should be able to give you the reasons why they think one is better than the other for you, hopefully, this video gave you some general ideas.
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Cheers!
Your example makes perfect sense then other videos about this topic!
Thank you, I appreciate the positive feedback.
Any other questions you have let me know, happy to make a video
Thanks, great information!
Glad it was helpful!
Thank you for this video!
Thanks for watching!
Straight to the point. Thanks
Thanks for watching!
Thanks for making this content. HELOC for smaller priced items that can be re-paid quickly with the potential of interest rate increasing.
Exactly. you don't want to be stuck with a large HELOC balance and an adjustable rate
Great topic!!
Thanks Mark! Its a popular question in 2020 for sure
Well explain sir thanks
Thanks and welcome
Thank you!
You bet!
So I've been in my 1st house for 5yrs now still owes $110 but it worth a little over $200 and I kinda agree with the cash out refi for the fixed interest rate but my question is, is a good thing to do a cash out refi and sell the house 3yrs from now? Planning to move to another state... thank you very much!
What if the terms on my first are good AND I need a large sum ? Example to reinvest into another rental property?
What if you don’t owe anything on your home and you need $100k?
Hi, I have a question. Is it frowned upon to use a HELOC or cash out refinance as a down payment on a primary residence? I would like to be able to rent out my current home.
It’s not allowed if you plan to move as it’s a primary residence loan and you plan to leave that home and buy a new primary.
I’d check with the bank on the HELOC and check the rules regarding using the funds to go buy a new primary residence
My terms of my current Mortgage are good (2.75% fixed) but I am looking to take out a large sum (~$60k) in order to purchases another investment property. With the concern of rising interest rates would it be best to stick with a cash out refi?
I’d run the numbers - rates have gone up pretty considerably
So in my case I’m a first time home buyer. I have been in my home for five years now. I need to do a cash out of 35K my interest rate is a 3.4% the value of my home now is 200K I bout it at 120K so do you recommend I refinance or do a HELOC? I’m a Florida resident
Same Here!! What is better?
I think cash out refi is better in many scenarios because its a fixed rate and one payment VS an adjustable rate HELOC and 2 payments. REally depends on your specific scenario though
Which did you do, I’m in the same exact position but I’m taking out $68k
Matt what is your advice if your 1st mortgage is low rate 2.5% currently like to heloc out 80-100K I owe 560,000 the house is worth about 800,000 I think cash out refi to 660K at 4.5 or 5% is going to not be as worth it to finance since I am wrapping such a much greater amount in a higher interest loan. My plan would be pay some debt down and use the rest for 20% on a cheaper rental property.
I’d like to use the money to invest on a flip property and pay it back from the sale 3-8 months later. Should I refi or heloc?
I’d like to use the money to buy a rental property and pay it back when I refinance the rental in 12-18 months. Refi or heloc?
Thanks for the info!!
For short term capital needs use a HELOC. Less upfront cost so usually a better bet.
I have 100k equity in my current home. I want to purchase a beach front short term rental property with the equity. Looking to take about 30 to 40k for a down payment. Do you suggest HELOC or cash out refi? My rate would be lowered and payment would only increase $40. Either way I'd benefit from a refi right now. Just not just if I should do the cash out or HELOC. Thanks!!
If you can cash out and lower rate I definitely recommend that. HELOC usually variable rate. Get the fixed 30yr money with refinance 🤩
@@MattTheMortgageGuy thanks! You got a new subscriber!
When you say: "if the term on your first mortgage are good or are not good", what do you mean?
What qualifies as a good term for a mortgage?
What qualifies as a bad term for a mortgage?
If you currently have a mortgage at a much lower rate than market rates you have good terms. i.e. You have a 2.625% 30yr fixed now it would be hard to justify a cash out refinance at 3.25% unless it was for a significant investment. Cheers!
Yes I’m not a fan of another payment
Desperately need advice.
I owe 162K on my house I bought in 2018. I'm doing cashout refi or intrest only 20/40 heloc through Navy Federal. My current interest is 4.5%. Im currently locked in at 4.875% on a 30 year cashout refi. As opposed to a fluctuating heloc starting at 6.75- 7ish.
The refi will be VA which means no funding fee, no PMI, no property taxes in escrow (I'm tax exempt due to my VA rating) the catch is if I do the refi my house will apprais probably in the low to mid 2's, as I need a thorough VA inspection, my house is on the lower end of houses in my neighborhood.
For the heloc the preliminary value for my property came in at $291197.00 and an exterior-only inspection of the property is required.
I'm looking for 70-100K which may be achievable with the refi as I'm allowed 100% LTV through the VA. The heloc will only allow 90% LTV but with a higher valuation it should be easy to hit my mark.
The equity will be for a short term investment 1-2 years.
With only homeowners insurance ($1500) going into escrow, my monthly payments on a cashout refi will be considerably lower then the heloc, even with 10K closing cost rolled into the loan. But I don't know if it makes sense to tack on 10K in closing cost if I plan on paying the loan off so quickly. I'm also terrified of the fluctuating APR on a heloc if it takes me longer then a couple years to pay back.
Any and all advice is much appreciated!
Thanks
H I have a Equity of $250.000 but I’m nervous if taking another loan even know I think this is right time
If it’s not in your budget to pay another payment don’t take out another loan.
I got a new job so I'm getting paid more now, but I just want to pay my 7k worth of credit card debt with 20%-25% apr. Heloc sounds like it would help me so I pay less interest.
What about refi to lower rate on house and also take out heloc?
Definitely an option
@@MattTheMortgageGuy ty. We were in process to lower mort rate on refi when we decided to take out heloc for an investment property. Was worried the refi might hurt our ability (credit wise) to get the heloc. 😅
@@user-iv6ty3cd5i - well, if you are doing at the same time you'll have to disclose to the HELOC lender the new balance of the refi SINCE the HELOC is based on CLTV (combined loan to value) of 1st loan + HELOC. Cheers!
@@MattTheMortgageGuy ty for your help! 👍🏻
What if my bank(chase) doesn’t offer HELOC’s?
If HELOC is better option than refi I’d try a local credit union. What the best option is depends on your scenario
What is needed to qualify for a Heloc?
Usually it is similar to a mortgage. You need decent credit, income to support ability to repay, and equity in your home. It will change from bank to bank , I'd contact a local credit union or small community bank in your area for specific HELOC info.
@@MattTheMortgageGuy you wouldn't recommend getting a Heloc WITH your current lender if that's a product they offer?
@@elyseesblasi3166 - most lenders don’t but you can inquire
I keep hearing that Heloc's have high rates. Never tried it.
I talked to a client today that said their local credit union was offering 4.5%. Not too bad but as always depends on the scenario
Cheers!
Yeah but I have good terms and need a lot of money lol
lol, how bad do you "need" that extra money is the question? if its for an opportunity that will yield huge returns maybe you refi into higher rate for short term.
You don’t say whe