Home Equity Loans
Gold Financial’s Two-Step Texas Cash Out
Are you a homeowner in San Antonio who has been paying your mortgage for several years? Do you need cash for something important, like your children’s college or to pay medical bills?
If you have built up some equity in your home, you may be able to turn it into ready cash for whatever you need with a home equity loan called a Texas Cash Out Refinance Loan. Gold Financial is ready to be your Texas Cash Out mortgage partner. We can make it very simple for you to acquire such a loan simple and easy.
First Step: Equity Explained
A home equity loan allows you to borrow money and use the market value of your home as the collateral. The beauty of equity loan lies in the fact that loans secured by real estate are considered safer by lenders. Even better for you, the borrower, this results in better terms than with other types of loans. Moving forward, Gold Financial is your “Two-Step” partner for a Texas cash-out loan.
Second Step: Loans Based on Law
For starters, by law, since you’re a Texan, that means you can borrow up to 80 percent of the value of your home. For example, if your home is valued at $100,000 with an outstanding mortgage debt of $40,000, you’ll have equity of $60,000. Since you are limited to borrowing no more than 80 percent of the home’s value, when you do the math, 80 percent of $100,000 is $80,000. Subtract the $40,000 mortgage debt to arrive at a maximum loan amount of $40,000.
If you’re scratching your head wondering, “Why can’t I borrow the full $60,000 of equity I have in my home?” The answer is that Texas laws provide that the total mortgage debt, including the amount of any existing mortgages, plus the projected home equity loan, cannot exceed 80 percent of the home’s current fair market value.
When it comes to Texas law, also keep in mind, if you are looking at the Texas cash-out option and you have 20 percent or less equity in a home, you will not be eligible. It may seem complicated alone, but with our mortgage specialists at AMCAP San Antonio as your partner you won’t have a problem. When it comes to equity loans for the homes in our area, we know the law.
After we get you through the first steps to get you started out in the right direction, bear in mind that a Texas Cash Out loan does have some cost. With the right partner, one of our specialists, you can move through this process with relative ease.
Just as with your original mortgage, a home equity mortgage will have closing costs. These are limited to 3 percent of the loan amount. It is also possible to pay “points” – this is a way to buy a lower interest rate or pay it down in a form of discount. There is no cap on this fee and is not included in the 3% closing costs rule.
The interest rate you pay is largely determined by market competition and conditions and your credit history. This is important and will further affect the rate offered. Home equity loans usually have higher interest rates compared to other types of loans, such as purchase loans and rate/term refinance transactions. However, it is still lower than other types of loans secured by personal property, or loans secured simply by a borrower’s signature on “unsecured signature loans.”
Another important factor to consider is this: “once a cash out, always a cash out”. If you get a home equity loan or a Texas cash out, the title of the property will always reflect a cash out. Even if you refinance the loan down the road, it will still and always be treated as a cash out transaction until such time the entire loan is paid off.
Let us show you all of your options so you can get the best deal possible. Get started today by teaming up with one of our Texas Cash-out Loan Specialists at 210-802-4665. If you need more information use our online tools on the website as well to get started.