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Refinancing
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=== Cash-out === {{main|Cash out refinancing}} This type of refinance may not help lower the monthly payment or shorten mortgage periods. It can be used for home improvement, credit cards, and other [[debt consolidation]] if the borrower qualifies with their current home equity; they can refinance with a loan amount larger than their current mortgage and keep the cash out. In situations where the borrower has both a first and second mortgage, it is common to consolidate these loans as part of the refinance process. However, even if the borrower does not receive any net "cash out" as part of the transaction, in some cases lenders will consider this a cash-out transaction because of the "12-month rule". This rule states that any refinance that occurs within 12 months of a second mortgage (that was not part of the original purchase transaction) is considered a cash-out refinance. <ref>{{cite web|title=Why Is This Mortgage Refinance "Cash-Out"?|url=http://www.mtgprofessor.com/A%20-%20Refinance/why_is_this_refinance_cash-out.htm|website=www.mtgprofessor.com}}</ref>
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