How to Get Approved For a Home Improvement Loan In Michigan

Need help with your house repairs in Michigan? Refinancing is a low-interest way to modernize your beloved kitchen, repair the holes in your roof, and do anything that you want in your home to be remodeled. One of the options to fund your home improvement needs is a cash-out refinance loan. 

Now, we’re going to look at how a cash-out refinance works in Michigan and how to qualify for one.

How does a cash-out refinance loan work?

In a cash-out refinance, you refinance your mortgage for more than you owe and take out the difference in cash.  The equity you’ve built up in your current house is the amount you can take out as cash. In other words, the more equity you’ve built up through the years, the larger amount of cash you’ll get through a cash-out refinance.

Let’s say the value of your house is $200k and your mortgage balance is $100k, giving you $100k of equity in your home. You could refinance your $100k loan balance for $150k and get $50k in cash at closing.

Because the amount you can borrow with a cash-out refinance depends on your home equity, your lender will require you to appraise your house so they can evaluate your house’s current value. If home prices have increased in your area, your home may be worth more than the price you paid for. 

Most of the time, you’ll be required to have at least 20% equity in your house, but this may differ by lender and by the type of loan.

Interested in getting a refinance loan in Michigan? Reach out to Reliance Financial Group for assistance.

Can you use the cash for other purposes?

When you do a cash-out refi, the money that you get is tax-free. You’re required to pay it back as a part of your mortgage balance, but it’s at a lower interest rate than what you might get with an unsecured loan.

You can use the money for house improvements or anything else you need, like tuition, a new SUV, and more. The money is all yours, and you can use it however you want to.

Do you have more questions about getting a home equity loan in Michigan? Get in touch with us today.

Requirements for a Cash-Out Refi

If you’ve decided to get a cash-out refi for your next home to remodel project, there are requirements you’ll have to meet and they may vary per lender:

• Must have a credit score of 620 or higher

• A DTI ratio of less than 50%

• A huge amount of equity in your home

If you think you could qualify for a home improvement loan in Michigan and you want to get one soon, we’ll be happy to assist you.

Are you ready to refinance for home improvements in Michigan?

If you’re searching for an affordable way to start your home improvement project finally, get in touch with Reliance Financial Group of Troy, Michigan, to help you pick the best loan deals available.

 

* Specific loan program availability and requirements may vary. Please get in touch with your mortgage advisor for more information.