The Million Dollar Question: Cash-Out Refinance vs. Equity Sharing Agreements vs. Selling Property Outright
3 Different Ways to Cash Out of Your Home Equity
Deciding how to cash out your home equity can be difficult. There are a few different ways to do it, each with their own pros and cons. Here are a few things to consider when deciding which option is best for you.
Cash-out Refinance
A cash-out refinance is when you take out a new loan to replace your current mortgage and receive a lump sum of cash at the same time. This is usually done at a lower interest rate than your current mortgage. However, you will have to pay closing costs on the new loan.
Equity Sharing Agreement
An equity sharing agreement is when you sell a portion of your home to an investor in exchange for a lump sum of cash. The investor then becomes a partial owner of your home and is entitled to a portion of the profits when you sell the home. This option can be beneficial if you need a large amount of cash quickly. However, you will have to give up some ownership of your home.
Selling Property Outright
Selling your property outright is when you sell your home for cash. This is usually the quickest way to get cash from your home equity. However, you will have to find a buyer who is willing to pay the full asking price.
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