Cash-Out Refinance Benefits in a High-Rate Environment

A cash-out refinance can position your mortgage team for success in a high-rate, high-debt environment.

Why would someone want to refinance in today’s market and potentially leave their low, fixed-rate mortgage? The answer is a much lower, all-in monthly payment. Homeowners care more about their payment than a rate. Talking with prospective borrowers about how they can re-position their entire financial outlook with a simple transaction can open the door to more lending opportunities for your team.

For example, a homeowner with the loans noted below can save $534 a month.

	Current	New
Mortgage loan	$200,000	$250,000
Mortgage rate	4%	6.75%
Credit card payment	$1,200	$0
Consumer loans balance	$50,000	$0
Total payments	$2,155	$1,621
Total balance	$250,000	$250,000
Monthly Savings	$0	$534

When your team engages with a borrower, do they thoroughly review the borrower’s complete financial situation? Consider if your team is:

Evaluating credit card payments and balances when processing payments
Identifying second mortgages or HELOCs where only the minimum interest payment is made
Forwarding potential opportunities to the lending team

Bankers’ Bank provides mortgage solutions to community banks, including cash-out refinances, purchase mortgages, and other products designed to enhance your fee income. We offer access to secondary market programs, USDA, and Federal VA lending programs, as well as best-efforts delivery on all locks. Our services are customizable to meet the specific needs of your team.