Texas Lone Star Lending Video
Tap Your Home Equity Without Touching Your First Mortgag
You may be able to access your home’s equity without refinancing your current mortgage. Here’s how it works and when it makes sense.
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Read the transcript
In our 5-Point-5 this week, we mentioned that your 1st mortgage may be able to stay untouched. Here's what that really means.
If you have a very low 1st mortgage rate, it makes sense to hesitate before refinancing - even if other debt payments are becoming stressful. The key is knowing that refinancing isn't the only path.
Some homeowners explore a home equity 2nd mortgage or a HELOC to access equity while leaving their 1st mortgage in place.
With a fixed-term home equity 2nd - sometimes called a HELOAN - you receive all the funds at closing. This can work well when the goal is to pay off multiple debts and simplify payments.
A HELOC works differently as it's a line of credit. This can make sense for things like home improvements or projects where you don't need all the money at once.
2nd mortgage rates are usually higher than 1st mortgage rates. If your 1st mortgage balance is low, or you're taking out a large amount of equity, a cash-out refinance - even at today's rates - may actually be the better overall option.
The right choice depends on your situation. That's why this starts with a conversation - not an assumption.