equity into cold hard cash?

Financing, Hard Money Lenders, Private Money
1

Hey Everyone,

I was wondering can you turn equity into cash?

Thanks.

2

Yeah. It’s called a “cash-out” loan.

3

Thanks 4EEM,

Could you tell me in detail how I could do a “cash-out” loan? Maybe an example?

Thanks

4

You go to a lender and ask for a cash-out loan or a cash-out refinance…

Example:

You own a house that appraises at $150k and you owe $70K (so you have $80K in equity). You ask to do a cash-out refi for 80%…you will get a $120K loan – $80K will go to pay off the old mortgage and the other $40K will go to you (there will be some fees and prepaids, etc. to pay).

Keith

5

…or if you already have a good rate on your mortgage you can just do a cash-out “stand alone 2nd”. You keep your current mortgage for $70K in place and get a new mortgage for $40K.

There is always the HELOC (home equity line of credit) option as well.

6

strted@22,

You can always turn equity into cash. And it is a great way to build wealth if managed correctly.
There is a great book out there called Missed Fortune by Doug Andrew. It really shows you the difference between letting your home sit with a bunch of equity vs putting that equity to work for you.
But be careful. It can be very dangerous if you do not make the right choices.
Question for you.
What is the rate of return on the equity in your home?

7

What is the rate of return on the equity in your home?

Sorry to butt in, but what exactully do you mean by this statement. Just Wondering because I just did a cash out, and never heard this phrase.

8

I meant it in good humor because "equity " trapped in your home has NO rate of return unless you pull it out and put it to work for you.
Your home is going to appreciate at the same rate weather you use those funds or not.