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6 Home Trends for 2023: What They Are, And How to Pay for Them
Read Time: 5 Minutes|
December 1, 2022
New year, new home trends! We’ve got a secret to affording your home renovations, home upgrades, and updates this year. Make your home your dream home with a cash-out refinance.
If you can’t find the home of your dreams on the market right now, we’ve got good news for you! We’ve rounded up a few of the ways you could achieve your version of a picture-perfect home – all within your current home! Even better, we also have a solution that could help you pay for the updates, without you having to break the bank.
Popular Home Trends
- Entertainer’s Outdoor Kitchen
Need inspiration to dress up the outside of your home? Create the ultimate entertainment backyard with an outdoor kitchen and dining area. How fun (and tasty) does a make-your-own-pizza night using a brick oven with friends and/or family sound? Count us in!
- Backyard Oasis
This is the year you could extend your indoor living space and start enjoying an indoor-outdoor porch/patio. Take the living room outside, stock a full bar, add TVs, ceiling fans, and sliding doors that open up the house to the backyard. An indoor-outdoor living space can be personalized to your design taste and lifestyle. Feeling inspired? Here’s more backyard transformations to plan out!
- Smart Features
While the concept of a smart home isn’t new, it’s a steady trend that many homebuyers and homeowners have come to value. Smart technology that offers the convenience of controlling the home remotely. Maybe you’d love fingerprint access to rooms in lieu of traditional locks, programming all the lights inside and out, or a high-tech home security seamlessly integrated into the design.
- Eco-Friendly Flair
Sustainable living never goes out of style. Energy-efficient appliances and long-term cost-saving features like solar panels or solar hot water heater can boost a home’s value. To go green on a lower budget, choose environmentally conscious décor like a display wall with air-purifying houseplants.
- Eclectic Styling
Mixing vintage furniture with brand new, different color metals, varying shades of wood, and shared-space rooms are all trending! When you think eclectic, think unexpected. Play with color, tie in global influences, layer rooms with multiple elements, and most importantly, make your home a reflection of you, your interests, memories, and travels.
- Multifunctional Spaces
Don’t be afraid to knock down walls, because shared rooms and open-concept living are in! If you think individual rooms are better off serving one purpose, it’s time to think again. Here’s what we mean: You could add built-ins to your dining room to house hobby items, like photography equipment or art accessories. You could finally move forward with the guest bedroom addition that serves as a movie theater or home office while guests aren’t visiting. Add space or make your space work for you!
How to Pay for Home Improvements
Did you know? You could tap into cash with a cash-out refinance. With that cash, you could afford home upgrades, updates, and stylistic improvements with the equity you’ve been building over the years!
What is a Cash-Out Refinance?
A cash-out refinance is a type of mortgage refinance that allows you to access the equity in your home. As a reminder: Equity is the difference between your mortgage balance and your home’s current worth. For example, if you purchase a home and put 10% down, then you have 10% equity in the home from the start. So, say the amount owed on a mortgage is $100,000 and the home is currently worth $200,000. In this case, there’s $100,000 in home equity.
With a cash-out refi, you refinance your existing mortgage into a new one with a larger outstanding principal balance and pocket the difference. You’re refinancing your original mortgage and replacing it with a new mortgage, not taking out an additional loan with an additional payment. The amount of cash you receive is generally based on the difference between your home’s current value and the remaining balance on the loan (equity). Other factors are evaluated (like occupancy and loan-to-value ratio), which is why meeting with a loan consultant can give you more insight into what your future could look like with a cash-out.
Why Choose a Cash-Out Refi?
By refinancing and using the equity already in your home to take out cash, you can get access to money at a lower rate than you would if you instead got a personal loan, as mortgage interest rates are generally lower. And instead of adding another monthly payment to your list, you’ll only have to make one — your regular mortgage payment.
Cash-Out Refi Advantages
Borrowers choose to cash out for many reasons, but one of the main draws is that the cash from your home equity is yours to use how you want. Another advantage is that rates are typically lower than other options like personal loans, the mortgage interest may be tax-deductible, and there’s a variety of loan types to choose from.
Want more info? Check out our cash-out guide.
What is a Newrez Home Equity Loan††?
Newrez Home Equity Loan is our new loan program built specifically for homeowners looking to tap the equity in their house without giving up their current mortgage. Keep your primary mortgage interest rate on your current loan when you secure a second mortgage. This new mortgage product has a fixed interest rate and is disbursed in a lump sum at the beginning of the loan. You’ll start repaying it immediately through fixed monthly Principal & Interest (P&I) payments. Plus, a Home Equity Loan with Newrez is secured by your house. This means you access larger sums of money at lower rates than credit cards or personal loans.
Lenders determine how much you may borrow by considering the amount of equity in your home, your credit score, and your debt-to-income ratio. With a Newrez Home Equity Loan, we can lend up to 80% of what your home is worth. Once your fixed interest rate and monthly P&I payments are determined, you’ll receive the cash value as a lump sum at the initiation of the Home Equity Loan.
You can use your home equity loan for just about anything. Popular uses include home improvements, college tuition, a vehicle purchase, and debt consolidation. People often turn to home equity for big milestones and life events, such as a wedding, education, moving costs, vacation, adoption, fertility treatments, or other medical expenses. Whatever your plans, home equity can provide the funds to make it happen.
Why choose a Second Mortgage (Newrez Home Equity Loan)?
If you have built up equity in your home and you’re looking to finance a specific major expense, then a Home Equity Loan could be a great fit for you. The fact that it’s secured by your home allows you to access a larger total amount at a lower interest rate —unlike a HELOC, which typically carries a variable interest rate. A Home Equity Loan with Newrez comes with a fixed interest rate. This means zero surprises when it comes to your monthly P&I payments, and no temptation to spend beyond your budget. Loan terms for a Newrez Home Equity Loan are for 30-years only. Put simply, the longer the term, the lower the monthly P&I payment. Plus, you can always pay off your loan balance early without any penalty.
Ready to explore your financing options, or get cash out? Let’s make your dream home a reality! Contact us to get started.
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