I'm Broke, but Have Equity. How do I get that cash out?


1. Sell. You can sell the property for its fair market value, pay off any debts as well as marketing and closing costs and what remains is yours. This will allow you to become debt free. Then you can re-assess when to reenter the market. Call me and I can get your started. 702-285-3444


2. Replacement cash-out refinance. In this situation the owner keeps the property so there are no marketing or closing costs, nor expenses for a replacement property. An existing first loan is replaced by a new and larger first loan. For example, if you have a $400,000 property with a $100,000 mortgage balance the loan-to-value (LTV) is 25%. If you refinance to 80% of the fair market value you can get $320,000 in new financing. After paying off the existing $100,000 loan the borrower has $220,000 in cash.

Program guidelines limit the amount of equity that lenders will provide with cash-out refinancing. For example: FHA guidelines limit cash-out refinances to 80% LTV. Conforming cash-out financing for a single-unit prime residence goes up to 80%.

Qualified veterans can get 100% cash-out refinancing under the VA program. However, many lenders will limit cash-out refinancing to a lower level, say 90%.


3. Cash-out financing with a HELOC or second loan. Instead of replacing an existing loan an owner can add a home equity line-of-credit (HELOC) or a second loan to the property. For instance, if there’s a $400,000 property with $100,000 in existing mortgage debt we can add a second loan for, say, $220,000, or a HELOC for the same amount. (A HELOC is essentially a secured line of credit against which the property owner can draw, much like a credit card.)

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        702-285-3444

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s.0051190    /   s.0060340

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Henderson, NV 89052

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