Student loan cash-out refinance basics
A student loan cash-out refinance allows you to roll your student debt into your refinanced mortgage. Referral Mortgages has partnership with lenders offering this option.
If you usecash-out refinancing option, you can borrow up to 80% of your home’s equity. Equity is the difference between the current value of your home and how much you owe on your mortgage. If you owe $200,000 and your home is worth $300,000, for example, you have $100,000 of equity in your home. With SoFi’s cash-out refinance program, you could refinance up to $80,000.
You could also roll your student loan debt into this amount. If you owe $30,000 in student loans, for instance, your total student loan cash-out refinance amount would be $110,000 ($80,000 plus $30,000).
This $30,000 difference would be sent directly to your loan servicer to pay off your student loan. Any student loans you roll into this refinance would need to be repaid in full.
While the balance on your student loan account will go down to zero, you’ll still owe this amount as part of your refinanced mortgage. So even if it feels like you’re student loan-free, you’re still responsible for paying it back, just in the form of your home loan.
If you want to know how does it works in your personal situation, we're going to place the the pros and cons to considered as one solution to cash out and low your student debt. Please contact us.