Put simply, a cash-out refinance replaces your existing mortgage with another loan that:
- Pays off your existing mortgage balance.
- Uses the equity you have on your home for additional funds to use for other expenses.
- Debt consolidation: Use the extra cash to pay off the debt of a high-interest credit card or on student loans.
- Improvements to your home: Add value to your home and make it more attractive for future buyers.
- Money in your bank: Emergency savings offer stability and peace of mind, so you can rest easy.
- Deductible taxes: If you use the money to buy, build, or improve your home, mortgage interest deduction may be available*.
*Supreme Lending is not a licensed CPA or Tax consultant and therefore, cannot determine if your mortgage interest will be eligible as a tax deduction per IRS code. You are advised to contact a tax professional. This in no way implies you are guaranteed a tax credit.