Cash out for bills
Question:
What are the benefits of both for a 20 year. homeowner who wants to cash out for bills and home improvements and investments?
Robert
Dallas, Texas
Answer:
If you take the REFInance, you could opt for a 15 year loan, keep your rate down because of the lower term, be able to take the cash out and have the interest right off. If the amount you need is not very much, say less than $25,000 then a 2nd mortgage might be beneficial. You will probably get a 15 year loan, rates will be higher though. If you are consolidating bills, then lowering your monthly payment outlay must be important to you, contact a mortgage professional and have them run the payments for both situations for you and see what meets your needs.
Seller carried back second.
Question:
We have been asked to finance the buyers second mortgage. What are the advantages and disadvantages? What should we consider?
Sue S.
Ellicott City, Maryland
Answer:
Disadvantage would be if you need the money to secure a new home for your self, you would be short or would have to borrow more. If you do not need the money right away, you will earn more than you would if it sat in a bank, typical second mortgage rates are about 9-10% right now. You would need to write the note for at least interest and for a minimum of 5 years if they are getting conventional financing. So it will also tie your money up for a least five years. Be sure to get a deed of trust recorded to secure your position as a lien holder.
Elsewhere…
— Second Mortgage and 2nd Mortgage Rates
— When Your Home Is on the Line