Cash-Out or Cash Back Refinance
This plan allows you to refinance your mortgage for more than you currently owe. The difference and the equity is converted into cash for the homeowner.
Is refinancing right for you?
Here are the most common reasons for refinancing:
- You have a fixed-rate mortgage with a high interest rate, and are looking to get a lower interest rate
- You have an adjustable rate mortgage (ARM) and are looking to get a fixed rate
- You have two mortgages and would like to consolidate them into one
- You have a long-term loan and would like a shorter-term loan so you can pay it off and build equity more quickly
- You have a short-term loan and would like a longer-term loan so as to reduce your monthly payments
- You want to move from an interest-only mortgage to a loan that pays down the principal
- You want some extra cash to make a purchase or to pay off other debt
Benefits of refinancing
Refinancing makes sense if you fit into one of the categories listed above. If you’re curious about your specific scenario, reach out today and we’ll take a look!
Four common refinancing options:
Lower Fixed-Rate Loan
If you currently have a high fixed-rate mortgage and the rates have dropped due to market conditions, then you may want to refinance to a low fixed-rate loan. Also, if you have an ARM, you might consider this option in order to get the security of a fixed rate. Even if your adjustable rate is low now, it is not guaranteed to remain that way; but if you get a low fixed-rate loan, then you lock that low rate in for the life of the loan. This option is a good choice if you are not planning on moving within the next five years.
Shorter-Term Loan
If your main goal is to quickly build up equity and to pay off your mortgage sooner, then the shorter-term loan is probably your best choice. A lot of times, if you refinance to this type of loan, your monthly payments will be higher, but you will pay substantially less interest and your mortgage will be paid off sooner. Also, you would benefit from a larger tax deduction on interest if you move from a 30-year fixed to a 15-year fixed loan. There are some cases, however, in which you may be able to refinance to a shorter-term loan without raising your monthly payment -if you’ve had your current mortgage for enough years.
Longer-Term Loan
If your current monthly payments are higher than is comfortable for your financial situation, then you might want to consider refinancing to a longer-term loan. This will result in a decrease in your monthly payments, since you will have more time to repay the loan. Examining your current mortgage and knowing how you would like to improve it are the first steps you need to take when starting the refinancing process. Once you know this, you can choose the option that will best help you achieve your goals.
Brian Mozley
Partner and Chief Growth Officer, Choice Mortgage Group // NMLS #196061
I have been doing this for twenty years, and the part I still care about most happens before any paperwork does. It is the conversation where somebody tells me what they are actually trying to do, and I get to tell them the truth about how to get there.
I grew up in Albuquerque and graduated from Manzano High School in 1999, then studied business finance and economics at the University of New Mexico. I started in the mortgage business in 2005. A year later, at twenty five, I opened my own brokerage. I had one year of experience and nobody in my corner showing me what I did not know. I learned most of it the hard way, and Financial Mortgage Solutions grew into one of the largest brokerages in the state before I merged it into Choice Mortgage Group in January of 2025.
Twenty years means I have worked through the 2008 crash, the refinance boom, and the market we are in right now. Guidelines change constantly. Rates change daily. What does not change is that most people feel behind and a little embarrassed when they start this process, and they should not. My job is to make sure you understand what is happening and why, so you are making the decision instead of just signing where you are told.
I care more about the relationship than the transaction. If you buy a house with me, I would rather you call me in four years about your neighbor’s question than never hear from me again.
Today I also serve as a Partner and Chief Growth Officer at Choice, where I spend much of my time coaching loan officers and helping them build better businesses. That matters to you for one reason. It means the standard your file is held to was set on purpose, and there is a whole team behind it instead of one person hoping nothing slips.
My faith is in Jesus, and I am grateful for a lot of grace I did not earn. I am active in my church, I coach my daughters’ soccer teams, and my family is the reason for the rest of it.
If you are thinking about buying or refinancing and you want a straight answer before you commit to anything, reach out. I am happy to just talk it through.
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Brian’s heart is in his work which ensures our clients have a great experience. He believes that it is important to make sure that his clients are informed about how the mortgage process works whether purchasing a home or refinancing a home.
