Depending on your goals and available programs, a second mortgage or home equity line of credit may allow you to borrow against home equity while leaving an existing first mortgage in place.
A second mortgage generally provides a defined loan amount with a scheduled repayment term. Depending on the program, the rate may be fixed and the monthly payment predictable.
It can be useful when you know approximately how much you need and want a defined repayment schedule.
A home equity line of credit generally provides a revolving credit line secured by the home. You may be able to draw, repay and draw again during the applicable draw period, subject to the program terms.
HELOC rates are often variable, so the payment and borrowing cost can change over time.
A cash-out refinance replaces the existing first mortgage with a larger new first mortgage and provides eligible equity as cash at closing.
It may make sense in some situations, but replacing a favorable existing first-mortgage rate can materially change the economics.
Available proceeds depend on property value, existing liens, combined loan-to-value limits, credit and program guidelines.
A fixed second mortgage may fit a known one-time need, while a HELOC may be more flexible for expenses occurring over time.
A second mortgage or HELOC generally leaves the first mortgage in place. A cash-out refinance replaces it.
Compare fixed versus variable rates, repayment periods, draw periods, payment changes and any fees that may apply.
Speak with U.S. Home Capital about the amount you want to access, your existing first mortgage and how you expect to use the funds.