Tag: cash-out refinance

U.S. Housing Boom: More Real Estate Investors Are Releasing Equity to Purchase Their Second Home!

U.S. Housing Boom: More Real Estate Investors Are Releasing Equity to Purchase Their Second Home!

The pandemic and rising level of inflation have birthed a global housing boom. This spike prompted U.S. property investors to invest in a second home and building their real estate investment portfolios. Sophisticated U.S. real estate investors can foresee that rental prices will steadily increase along with rates. The question is; how exactly are they pulling this off? By releasing their equity for existing realestate! 

It’s safe to say that this trend began in last year’s second quarter. As per stats from Black Knight, Inc., that period saw the most significant quarterly volume in cash-out refinances in over a decade, with U.S. homeowners withdrawing $63 billion in equity from their homes. 

It’s tricky to identify the exact number of U.S. real estate owners cashing out from their current properties to purchase more. However, this pool has both experienced real estate tycoons and beginner investors hoping to become the next thriving generation of lessors. 

What Are The Chances Of Success? 

Of course, releasing equity to invest in a second home or investment may seem somewhat risky, especially for a first-timer, but this is not necessarily a doomed endeavour if you play your cards right. In fact, cash-out refinances have enabled countless non-resident and U.S. expat property investors to grow exponentially within a limited period. A majority of those who sunk that money into rentals now bring in thousands of dollars in rent. 

The thing is, interest rates have increased all across the nation. As a result, many first-time buyers cannot afford to purchase homes due to high mortgage rates, so they are forced to settle for rentals until the housing market becomes friendlier. With the soaring demand for these properties, landlords have no option but to push up rents. Therefore, you are likely to make huge profits from your rental property, which might even pave the way for you to purchase more. 

As you contemplate buying a second home or investment in the U.S. through releasing equity from your existing property, do your homework. Don’t make any purchase decision before you know exactly what you are getting yourself into by remortgaging. For example, what are the costs involved, and how do they measure against the potential proceeds from your new property or the expenses you will incur to take the best care of it? If these sound daunting, fret not, this is where America Mortgages comes in! Consult our team of expert mortgage advisors tohelp you judge if you are making the right choice. 100% of our clients are living abroad. As the global leader in this market, we know how to navigate through this process better than anyone. 

If becoming a U.S. real estate investor is on your bucket list this year and you own U.S. real estate, releasing your equity could be the fastest path to get you there. Yes, this could easily be a holiday home for you and your loved ones, or a buy-to-let and boost your monthly income. 

America Mortgages’ ONLY focus is to provide U.S. mortgage financing to foreign nationals and U.S. expats looking to buy, refinance or release equity for U.S. property. We offer the most comprehensive loan programs for international real estate investors. Ready to release equity to purchase your U.S. home?

Ready to release equity to purchase your second U.S. home? Speak to us today to find out more! hello@staging-americamortgages.aljuncapapas.com

Cash-Out Equity Release. Is now the time?

mortgage for overseas property

There’s something about having cash on hand that feels empowering. Being able to invest in projects, equities, crypto, or a business opens up endless possibilities. It could be to pay off high-interest debt or taking the family on a dream vacation before the children get too old. We hear this daily when speaking to clients that are considering cash-out refinancing.

What is a cash-out refinance?

A cash-out refinance is a mortgage refinancing option in which an old mortgage is replaced for a new one with a larger amount than owed on the previously existing loan, helping borrowers use their home mortgage to get some additional liquidity. You get the difference between the old mortgage and the new and the money can be used however you like. The amount received depends on the equity built up in your property.

How does it work?

Cash-out refinancing depends on several factors which include the value of the property, the amount owed, and how much you can qualify to borrow. Your America Mortgages loan officer can help you determine if this type of financing makes sense from a cost basis.

The potential benefits of a cash-out refinance

  • 1. A lower interest rate on your mortgage – Let’s say you bought your home when mortgage rates were much higher. Refinancing your home can improve your financial situation if you are able to obtain a lower rate.

  • 2. Debt consolidation – The money from a cash-out refinance can be used to pay off other high-interest debts, like credit cards and college loans. This could save you thousands in interest in the long run.

  • 3. Credit score improvement – Building on the previous point, paying your credit card debts off in full using a cash-out refinance can build your credit score by reducing your credit utilization ratio.

  • 4. Tax deductions – If you’re looking to improve your home using the cash from a cash-out refinance, you could potentially qualify for mortgage interest deduction.

  • 5. A cheaper way of paying for your kid’s education – It’s every parent’s dream to be able to put their kids through college, but high-interest student loans can be extremely stressful. Using a cash-out refinance can be a good alternative if the rates are lower.

  • 6. Inheritance – Although we advise you to speak with your attorney or tax advisor, it may be possible to reduce the amount of inheritance tax when estate planning with increased leverage.

  • 7. Take advantage of an opportunity – With the current situation with Covid, there are a lot of opportunities that may not be available once the world goes back to “normal”. Having access to liquidity and being able to act immediately can be potentially life-changing.

So, should you do it?

The truth is, cash-out refinancing can be a good way to improve your financial situation – we think of it as an affordable way to borrow money if you own substantial equity in your home. The money from a cash-out refinancing can even be used to rebuild equity that you’re taking out if you decide to use it on value-adding home renovations.

Interested in cash-out refinancing? America Mortgages has a 97% approval rate for both U.S. Citizens & Foreign Nationals. That is our sole focus and our expertise.

For more details please visit us at www.americamortgages.com

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