Refinancing with our minimum-down-payment program allows you to get a top-quality loan on your home. Whether you want to make more investments, or simply prefer to have liquid capital ready when you need it, this program gives you plenty of options.
And as you’ll see, it has advantages that you can’t find with many other cash-out refinancing programs…
Top 6 Reasons to Use Our Minimum-Down-Payment Program for Cash-Out Refinancing
1. Allows for Cash-out Refinancing Even with Minimal Equity on Your Home
If you only have a relatively-small amount of equity in your home, you can still use this program to get the financing you want for your new mortgage. When you begin the refinancing process, you will discover that most lenders require a specific amount of equity before they will process the new loan. If you have very little equity, you may not be able to refinance your home, which means you could be stuck with those high interest rates or less-than-ideal terms, and you won’t be able to utilize your accumulated equity.
How much equity do you need? For many programs, you will need at least 80% equity in your home. However, under certain circumstances we may be able to help you get approved even if you have a lower equity amount.
2. You Can Refinance a Non-Warrantable Condo
Non-warrantable condos are often impossible to refinance. “Warrantable” simply means a condo building or unit that would qualify for purchase on the secondary mortgage market by Fannie Mae. This is an important distinction, as many lenders, even if they are not selling the loan to Fannie Mae, will use their requirements as a base guideline. Some will avoid non-warrantable condos, but we can actually help secure financing, or in this case cash-out refinancing, on a non-warrantable condo.
What makes a condo non-warrantable? One of the most common issues is single-party ownership, as Fannie Mae prefers that facilities don’t have a high percentage of units that are owned by one person or business. Other factors that can make a condo non-warrantable, and therefore ineligible for other refinancing programs, include zoning restrictions and unit sizes. The lender will also need information on the finances of the Homeowners Association (HOA), which can delay or even derail the loan process. If the HOA is in any way involved in a lawsuit, there could also be issues with financing, as this will impact the cost of living in the building.
As you can see, there are many factors that make a condo non-warrantable, but this is not a concern for our loans.
3. Allows for Up to 95% Value
With this refinancing option, you can enjoy and extremely-high, rarely-seen loan-to-value for your refinance. This loan program allows up to 95% value under certain situations, which means you can get the financing you need from a larger portion of your home’s value.
For most jumbo investors, 95% on a refinance is unheard of. There are many large banks that won’t go above 70% cash-out on a primary residence, and a conforming loan sponsored by Fannie Mae or Freddie Mac will only let a borrower use 80% cash-out value on their property. Generally, for a borrower to take out 95% of the value, they will need a second mortgage, usually in the form of a Home Equity Line of Credit, but this is not the case with our loans.
4. Allows for Refinancing Shortly After Bankruptcy
If you have gone through a bankruptcy, foreclosure, or short sale over the past decade, there’s a good chance that this will keep you from using most refinancing and mortgage options. Most people familiar with these situations will notice an issue: if you’ve gone through a bankruptcy or a foreclosure, you probably lost your home; why would anyone under this circumstance need refinancing?
In some cases, people can go through bankruptcy and still hold on to their home, as this may be protected under the terms of your bankruptcy filing. It’s also entirely possible that your foreclosure was on a second home, which means you could still have possession of your primary residence. So while it’s rare, there are still people dealing with the aftereffects of a financial issue who still own their home.
With this program, you only have to wait four years after a bankruptcy, foreclosure, or short sale. This means you can actually refinance your home much faster, as most other jumbo programs require at least seven years since the incident.
5. Can Bring a Smaller Interest Rate
It’s possible that this program could bring a lower interest rate to your mortgage, although this obviously depends on the current program you are using. There are some loan programs and credit unions that will allow a 95% cash-out, but with these loans you will likely pay a higher interest rate. In many cases, you could be paying over 8% interest on your refinancing, which would likely negate any benefits you might realize from refinancing altogether.
6. Use the Equity of Your Large Home
Finally, this cash-out refinancing program simply allows you to use the large equity you may have built into your home. Some programs have lower limits on how much you can utilize, in total, in your home’s equity, but this is not a concern for this program. You can actually use the cash-out refinancing to secure up to $750,000, which is practically unheard of with other programs. This high amount allows you to take advantage of the large total equity you have built throughout the years.
Learn More About Minimum-Down-Payment Program for Cash-Out Refinancing
If you want to learn more about our excellent cash-out refinancing options, contact our team today. With a strong understanding of the mortgage industry, as well as the resources and knowledge that enhances your approval chances, we are the right choice for jumbo loans.
From large loans for a primary residence to outstanding investment-property mortgages, you’ll get the financing you need for all of your purchases.
“Hey Chad – thank you so much to you in particular as well as your team. It’s been a real pleasure working with someone who’s as responsive and helpful throughout the process, as you’ve been. We really appreciate what you’ve done. ”
A very responsible and experienced professional with his highly effective team
I really enjoyed working with Chad Baker and the rest of the team. This was our first time buying a home in California and we started with unnecessary assumptions based on our previous experience as home-owners in a different state. Chad and his team were available throughout the whole process, explaining the state differences, answering all our phone calls and emails quickly and directly, and providing detailed weekly status reports so that all parties including agents knew exactly where we were in the process. Chad was very experienced and provided customized loan products for us to consider, which definitely facilitated our transaction. I recommend the Chad Baker team! ”
“Hey Chad, Just wanted to send a quick note to Thank You for all your work and effort to get this escrow closed. It was a pleasure to work with someone as professional as yourself. If I have a client that ever needs a lender you will definitely be someone that I would recommend.”