Finance
What is a 'cash-out refinance' and how does it work in Delaware?
ARefinancing to pay off the mortgage in full using cash on hand
BRefinancing a mortgage for more than the current balance — receiving the excess as cash; the borrower replaces the old loan with a larger new loan, using the equity in the property✓ Correct
CA refinance that converts a fixed-rate loan to a variable-rate loan
DA Delaware first-time homebuyer program offering cash toward the down payment
Explanation
A cash-out refinance replaces an existing mortgage with a new, larger loan. The borrower receives the difference between the new loan amount and the payoff balance as cash. It allows homeowners to access equity for renovations, debt consolidation, or other purposes. The new loan has different terms and resets the amortization schedule.
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