Refinancing Your Home to Pay for College

College tuition is expensive. Though many save for the expense, few people have the ability to pay for an education in full. Those who are not eligible for financial aid, grants, or scholarships may have a difficult time coming up with the cash. Fortunately, there are other ways of paying for a college education, such as refinancing your home.

Refinancing vs. Student Loans

For some, student loans are the only option when money is needed for college. But, for those who own a home and have built up equity, other options are available—namely refinancing. Refinancing your home to pay for college has its benefits over student loans; the main benefit is the interest. While student loans often come with low interest rates, the student loan interest eventually begins piling up. By the time you get your degree, diploma, or certificate, you will be paying back much more than you originally borrowed. By refinancing your home, you can keep interest costs at a minimum. You can also borrow all of the money you need at one time as opposed to taking out multiple student loans every year.

Is Refinancing Your Home Ever a Bad Idea?

Not necessarily. Refinancing your home can be very beneficial. A home is an investment. The equity that has been built up is your money and should be used for the things you want and need. College is a great example. However, if you feel that you will have trouble making your payments, you should not refinance. If you can’t keep up financially, you could be in danger of losing your home.

Finding a Lender

The lending market has become extremely competitive, which is great news for you if you are interested in refinancing your home. While looking for a lender, don’t be afraid to shop around. You should compare everything from lending fees and interest rates to loan terms and closing costs. Here is a list of recommended Home Refinance Lenders online. It's important to use a reputable lender online to make sure your personal information is secure.

View our suggested lenders for a Cash Out Mortgage Refinance, or if you’re interested in a Real Estate Home Loan Refinance for money to pay for college tuition.