Pay Off 2nd

Mortgage

or HELOC

Pay Off 2nd Mortgage or HELOC

What is the Benefit?

Paying off a HELOC or 2nd mortgage through a cash-out refinance is a good way to save interest and/or lower your monthly payment. A cash-out refinance is an ideal choice for many consumers especially given the recent substantial home equity increase.

Here’s the breakdown on benefits of taking advantage of a cash-out refinance versus getting financing through a 2nd mortgage or HELOC:

Traditional Loan

M

Teaser Interest Rates or Adjustable Interest Rates: HELOC’s from your local bank or credit union typically have teaser rates and adjustable rates

M

Shorter Loan Terms: HELOC’s typically have an initial draw period followed by a repayment period where you can no longer draw on the loan

M

HELOC’s and 2nd mortgages may cause difficulties and/or prevent you from opening additional financial transactions on your property such as refinancing

M

HELOC’s and 2nd mortgages may cause issues when trying to sell your property

Cash-Out Refinance

N

Lower Monthly Payment: combining a first mortgage and a junior lien typically lowers the overall monthly expenditure when compared to paying them separately

N

Lower & Fixed Interest Rate: many HELOC’s have higher rates, adjustable rates, or start out with a low teaser rates and convert to adjustable rates once the teaser period ends

N

One Monthly Payment: once we payoff your HELOC or 2nd mortgage, your loans will be consolidated into your mortgage loan so you don’t have to worry about making payments to another lender