Refinance Advisor

This Free Refinance Advisor has been designed to help narrow down options based on your individual needs. It’s quick, it’s easy, and the more questions you answer – the more accurate your results. You’ll receive the Refinance information you need instantly without all the calls and emails!

Questions about refinancing? Contact us today! Local mortgage lender servicing Kingwood, The Woodlands, Cypress, Sugar Land, Baytown, Friendswood, League City, Houston Heights, Humble, Stafford, Texas City, Alvin, Magnolia, Conroe, Katy, Channelview, Spring, Tomball and Pearland. Call us on (832) 742-6167.

New Texas Cash Out Refinance Rules Effective January 1st 2018

Q. How much equity do I need to get a Texas Cash Out Loan?

A. A borrower can take equity out of their home in Texas as long as they leave 20% equity in their home when they obtain a Cash Out Loan. By way of example, if you have 50% equity in your home you can borrow 30% of the equity but must leave 20% equity in your home. This is a unique law in Texas and is intended to protect home owners from taking out too much equity from their home.
If your home is worth $300,000 and you have $150,000 in equity, you can borrow (or “take cash out in the amount of”) $90,000, which leaves $60,000 (or 20% of the home’s value) in equity. The loan amount would be 80% of the appraised value or $240,000. From that loan, $150,000 would pay off the existing lien, you would get $90,000 after the loan funded, less any closing costs or escrow account building.

New Texas Cash Out Refinance Rules January 2018

Q. How often can I take cash out of my home?

A. You are legally allowed to get a Texas Cash Out Home Equity Loan 1 time per year, but twenty percent equity must remain.

Q. Is this rule only applicable to my primary residence?

A. Yes, the Texas Statute only pertains to cash out home equity loans on your primary residence. These rules do not apply to other investment property.

Q.Can I refinance my home after I obtain a Texas Cash Out Home Equity Loan?

A. Yes, you can refinance your home if you previously received a Texas Cash Out loan. The only criteria is that you will need to wait Twelve months from the date of your original cash out loan. The Texas Law was changed and effective January 1, 2018 to rescind the “Once Texas Equity Loan always a Texas Equity Loan” statute that mandated that you had to refinance using the same type of Texas Cash Out loan for all subsequent refinances. Now you can use a regular “rate and term” conventional loan on a subsequent refinance as long as you don’t take any cash with that loan.

Q. Can I borrow with a home equity line of credit (2nd lien) if I already took out a Texas Cash Out Loan in the past?

A. No, you can only have one Texas Home Equity loan in place on your home at the same time. That said, if you took out a Texas Cash Out loan in the past and want to borrow more from your property you can, by refinancing your existing first lien into a new Texas Cash Out Home Equity loan.

Q. How quickly can I get Cash Out of my home?

A. The process to get a Cash Out loan is like any other home refinance, approximately 30-45 days. Under the Texas statute, as part of the process, you need to sign a letter that explains how a Texas Cash Out home loan works and wait a minimum of 12 days from when the loan application process starts until when the loan closes (this is known as a “12 day letter”). This twelve day letter is running as the rest of the loan process is going on, so it does not add an additional twelve days to the process.

New Texas Cash Out Refinance Rules January 2018

Q. Where do I have to close a Texas Cash Out loan?

A. Texas cash out refi’s are required to be closed at a title company or your lender’s office.

Q. What were the most important changes to the Texas Cash Out Laws that became effect on January 1, 1998?

A. Texas Cash Out Loans can now be made on a property with an Agricultural exemption, not sure why this was excluded in the first version…?

A. The rule about once a Texas Cash Out – Always a Texas Cash Out has changed (you can no refinance using a normal conventional loan if it has been at least one year since your last the cash out loan) This is a major positive change, and will help a lot of people get out of previous bad loans.

A. There is now a 2% restriction on fees but does not include the appraisal, the survey and the title insurance. This is another important change, because previously the lender could not include these fees and be profitable unless the loan was over a certain amount.

Many lenders don’t offer cash out refi’s in Texas. We have specialized in Texas cash out refinance loans and we understand the relevant Texas laws.

Don’t let an out of state lender tell you what you can or can’t do. Trust a local specialist!
Texas Cash Out Loans – From a Texas Lender!
GET A CASH OUT LOAN by calling 832-742-6167 or visit the
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Texas Constitution – Section 50(a)(6)
New Texas Cash Out Refinance Rules January 2018