is this foolish - refi to pull money

I haven't heard back from the bank except that our credit checks out that we can pull out of the FHA range.

We are in the process of finding out about pulling out of our FHA loan we had closed on about 1 year 7 months ago to get a conventional loan with about 30K of cash to be taken out for home modifications. We have 201K left on the mortgage at 5.5% interest. The rates today are around 4.375%. We would use the cash for siding and new windows nothing too high end since we have been pricing out siding/windows we are probably looking at 20K but want to have some cash just in case there is rot that needs to be fixed. Our area has had houses close for 195K, 275K, 310K to 340K. It all depends on size/condition.

Is it dumb to pull cash out to do the siding/windows - we have to say in the house until 2019 but may stay longer after that. Or should we just refi and have reduce payments and keep saving even if it might take us 5 years to get the cash?

Our house has the original wood shake that has been painted and is deteriorated. I have rot, bug issues, holes that i have caulk and two windows have seal breaks, two other windows can't open without being propped up.

Re: is this foolish - refi to pull money

I always told Dh if we took money out against the house it would need to be for the house. Also if it's not your forever home the repairs would help you sell later. I'm a new owner myself and not 100% familiar with refinancing so I can't discuss the cons.

Re: is this foolish - refi to pull money

bumping for the weekday peeps

Re: is this foolish - refi to pull money

I don't think it's dumb - you are adding value to your house and getting a much better interest rate.

Re: is this foolish - refi to pull money

I don't think it is foolish to pull moeny out to help improve your home. In the long run with new windows and siding you will also help make your house more energy efficient.
As long as the pymt is something you are comfortable with definately go for it.

Re: is this foolish - refi to pull money

thank you all! I figured siding/windows aren't a luxury item, this is something necessary and it was told to us that we have to do it by inspectors and even people who are in the building business that are friends that our house is going to be falling apart soon unless we do it. Its not like I am adding a insane kitchen with marble floors because i will never get back that money on my specific block. But I have to make sure whatever we are refi'ing that cost we would save would be the cost for the extra money and no more. Ex. if we refi and save $300 per month that taking out $30K wouldn't be anymore then $300 a month. Still waiting to hear back from the bank - this might not even happen.

Re: is this foolish - refi to pull money

If you can do it and still be paying the same monthly payment I would definitely do it. You are making your house a more appealing home for yourself, more energy efficient which lowers your bills and increase you home's value if you decide to sell.

Good luck! I hope we get to see before and afters!

Re: is this foolish - refi to pull money

Look to see if they are still doing the federal incentives for buying energy efficient windows.

We got a nice tax credit a few years ago when we updated our bay windows.

Making your home energy efficient is a good move for now and the future.

Re: is this foolish - refi to pull money

Re: is this foolish - refi to pull money

i just refinanced with HARP so i wasnt allowed to cash out. if i was i would have in a heart beat!! I have such a laundry list of things i want to do to my house but no money to do it!

you're putting equity back into your home and raising the value. definitely worth it!

Re: is this foolish - refi to pull money

Mm been two days and no word perhaps they are waiting to see what the market is doing?

Should I see about refi'ing elsewhere besides the bank I have my current mortgage with?