Mortgage Blog

I am trying to get a refinance for my client. The primary home is 500k with current rate 2.625%, since it is 4th year on the 5/1 ARM, borrower wants to refinance.

And he has a few other mortgages for the rentals. You know, rental rates are normally higher(Actually 4% for this case). 

So if we refinance the primary home rate only, we can only get the rate around 3%. But if we can cash-out the loan with the loan amount around 720k, then we can payoff that rental and we can get rate of 2.875% for 5/1 ARM(3.125% for 7/1 ARM). The total monthly payment is actually lower. And the borrower has extra 4 years for low ARM rate.

And I know there are a few other borrowers who has the similar situation. It might not be a bad idea to cash-out the primary to Jumbo.