As homeowners know, their home values have gone up exponentially in the last few years, all across Albuquerque’s metro and the rest of the New Mexico too. Many homeowners are sitting on a lot of equity and they would like to tap into that equity for cash out for a many reasons, like home improvement, a big wedding, travel, or to pay down other debts.

The question is do they do a full refinance or take a second mortgage out instead. The answer is “it depends”. It matters how much you owe on your property, what your current interest rate is, what your current mortgage payment is, and how much money you are taking out.

The rule of thumb is this: when looking at a full refinance, take the new loan amount including the cash out at the new interest rate and calculate your payment… set that number aside. Then look at a second mortgage with the amount of cash you want and calculate that payment.

Now, take your current house payment combined with the new second mortgage payment, add those up, then compare that to the full refinance payment. Whichever is less is your best option.

It sounds complicated, so to see what’s best for you and your family, just call Indigo Mortgage and we will do the evaluation for you, free of charge. There’s no need to pull your credit, all we need is your current interest rate and current mortgage payment. We will do the rest. No pressure and we won’t try to influence you one way or the other.

Indigo Mortgage has been in business in New Mexico since 2003. Our motto is “no one cares more about your mortgage loan” and we mean that. Let us know if we can help.