Advantages and Benefits of Cash Out Mortgage Refinancing

  • Lower interest rate

  • Lower monthly payments

  • Get lump sum to pay-off debts

  • Overall savings from debt consolidation

  • May raise credit rating if pay-off credit cards

 

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Disadvantages and Risks of Cash Out Mortgage Refinancing

  • Decreases home equity

  • Increases total mortgage balance

  • Decreases tax return savings

  • Prolongs repayment term

  • Prepayment and refinance fees