Refinancing for a cash out:
Cashing out refinance is were you ask for some of the homes equity; to do things like home improvement or pay some debit maybe even buy a car. Whatever you do it for the interest you pay on your mortgage is tax deductible.
If you are taking cash out, your loan will be limited to either 95% or 85% of the appraised value, depending on your qualifications. However with todays banking crisis most banks are making it 85%. Also you would have to roll in the closing cost within that 85%.
203K Loan – Rehab Program:
This type of loan is only offered through FHA approved lenders. This loan program is used to rehabilitate distressed properties; that would appraise for the purchase price plus the amount of the rehabilitation, once the work is completed.
Streamline 203K Loan :
This program the buyer can finance up to an additional $35,000. into their mortgage to pay for remodeling such as replacing flooring, installing new appliances, and painting the interior and exterior of the home. Advantages of this loan is that you can buy a home that needs a lot of work, but you still have only one mortgage payment, and you can complete the repairs after buying the home.
FHA 203k loan program is the HUD Department’s primary program for rehabilitation and repair of single family properties. This is basically a home improvement loan; this loan is very important for communities and neighborhood’s ability to revitalize and to expand homeownership opportunities. This is one of HUD’s primary goals.