The FHA Cash-Out Refinance is the answer for homeowners who want to take cash out of their home equity for things like making home improvements, paying off debt, funding school, establishing an emergency fund, or any other financial need that they might have. A Cash-Out Refinance Loan can be used to refinance a non-FHA loan, such as a Conventional or FHA loan into a FHA loan. FHA will guaranty loans up to 100% of the value of your home depending on Loan Limits that have been pre-determined for the county your home is in.
Here are some things that you need to know about the FHA Cash-Out Refinance:
- The liens to be paid off may be current or delinquent and from any source, such as tax or judgment liens or FHA, FHA or conventional mortgages.
- Loan proceeds beyond the amount needed to pay off the lien(s) may be taken as cash by the borrower for any purpose acceptable to the lender
- The loan must be secured by a first lien on the property.
- The maximum loan amount is 80 percent of the appraised value, plus the cost of any energy efficiency improvements, plus the FHA funding fee.
- The borrower must certify that they intend to personally occupy the property as their primary residence.
