If you have built up some equity in your home, when you refinance, you may be able to "cash out" some of that equity to pay off credit cards or other revolving debt, improve your home, help pay for college, or anything else you can think of. The same is true of refinancing costs: If you have enough equity in your home, you may be able to roll some of the cash due at closing into your loan.

Some of the "cash needed to close" as it's sometimes called includes settlement costs and fees, prepaid interest, escrow reserves, state or local government charges, or even extra funds needed to pay off your existing mortgage. Some or all of those costs can sometimes be financed as part of your new mortgage loan.

But you have to be careful. It is not always the case that you can borrow up to 100 percent of your home's value, even though with VA loans it is permitted. It is the lender's choice.

Many loan programs are based on what's called a "loan-to-value" (LTV) ratio. You may qualify for a very advantageous refinanced mortgage if you borrow no more than eighty percent (80%)of your home's value, but may not qualify for the same terms if you borrow ninety percent (90%). We can help you qualify for refinance loan programs for as much as one hundred percent (100%) of your home's value The lower your loan-to-value ratio, the less easier it may be for you to qualify while the rate may be better, too.

The bottom line is that in many cases, if you can lower your current interest rate on a fixed rate 30-year loan about one percent (1%), it is probably worthwhile refinancing. With a lower LTV you can reduce your upfront costs for refinancing your mortgage, and lower the monthly payments for the life of the loan. But whether -- and to what extent -- you can do this depends on the value of your home and the amount of your new mortgage, and what options you decide are best for you. The requirements and creditworthiness of each borrower are different, so a loan officer has to take into consideration all ramifications of the application.

If you've had your current mortgage for a few years, chances are you've built up enough equity to finance cash needed to close and still have a smaller loan balance than your original -- and a balance that will qualify you for a favorable mortgage program tied to your loan-to-value ratio. We can help you decide!

Many people find that it's advantageous to pay the cash needed at closing from checking, savings or money market accounts or from other assets. This is because the less you borrow on the new refinanced loan, the lower your monthly payment will be. But we'll work with you to see if there is an advantageous refinancing program for you based on your ability and willingness to pay closing costs and other fees and the amount you wish to borrow.

We want to make the best loan for you, work for you!