What are my refinance options?

You may be considering a loan refinance in order to change your interest rate, adjust the length or type of your mortgage, or liquefy the equity built up in your home. Refinancing can be a great option if you do not have a prepayment penalty on your current mortgage, and plan to spend a long time in your current home.

How We Help

When we help our clients refinance, we provide them with the best education on their options. We offer both streamline and cash-out loan options to help you meet your financial goals. We want to make this process as simple as we can for you.

Cash-Out Refinance

Cash-out refinance is an option for homeowners who would like to liquidate some of the equity in their homes. They replace your original mortgage, and pay the difference between your home’s current value and the current balance of your mortgage. Cash out refinances are typically used to:

  • Pay for additional improvements to the home
  • Pay for a large expense, such as a wedding or college education
  • Consolidate higher-interest debt, such as high credit card balances

Keep in mind that there are certain limits and changes that come with a cash-out refinance. You can only cash out 80-90% of the total value, and if you cash out more than 80%, you will need to pay PMI. With a refinance, your mortgage terms will change, including APR and terms. You will need to pay closing costs on a cash-out refinance.

Streamline Refinance

Streamline refinances are offered for both FHA and VA type loans. This type of refinance can be simpler, as it uses the original loan paperwork and reassesses the loan based on your current home equity. Streamline refinances are helpful to:

  • Change your loan type, such as switching from an ARM to fixed-rate.
  • Reduce your loan APR after change in the market or your credit.
  • Keep borrowers who are underwater on home value in their homes

As with a cash-out refinance, there are certain limits and terms that come with the streamline. For example, the FHA and VA only approve streamlines where the net benefit to the borrow is a 5% or more reduction in home payment cost. Additionally, streamline refinances do not allow the borrower to cash out equity on the home. For a full description of the terms for your situation, please contact us.

Frequently Asked Questions & Answers

Have a look at frequently asked questions & answers to understand more.
The best option for you will depend on your current loan type, whether you are looking to change loan types, and how long you plan to remain in your home. Streamline refinances are simpler, but typically only available if you are just changing the interest rate on your loan type. Cash-out refinances are best if you are looking to liquidate your home equity.
You should plan to stay in your home for more than 5 years after a refinance, to rebuild equity and maintain loan stability.
You may be better off waiting and repairing your credit if you need to refinance your home. We offer several tips to help borrowers understand the impact of credit to their refinance, and how to improve their scores.
Removing a borrower from a loan is one reason to look at a refinance. Keep in mind, however, that the lender will require you to qualify on your own for the new terms, in addition to the consent of the co-borrower. Talk to us if you have questions about this and we're happy to assess your current situation.
When you refinance your loan using a cash-out refinance, you will need to pay closing costs. If you are using a streamline refinance, there may be minor distributions from the refinance to cover the costs of closing and paperwork.
You may want to consider refinancing your FHA loan once your loan-to-value percentage is high enough to remove your mortgage insurance premium. Let us help you understand the right time to make a switch to a conventional or other FHA loan option.

Why They Choose Us

Learn More

At Diversified Lending, we're here to ensure that you have the best information to make a decision for your future. Whether you are ready to buy today, or just looking to get started on the process and plan for the future, we're here to help you get started with the mortgage loan tools and programs to get you in your new home.

Get the process started today!

Reach out to see about lowering your monthly payments and/or interest rate.
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