No. of Recommendations: 0
Though I don't argue with you, I for one would be deeply confused to hear the term "refinance" used in the context of obtaining a new loan secured against something already owned free and clear.
I fully agree on the terminology - it's not intuitive.
If there's another term someone is aware of for taking out a mortgage later on a fully paid off home, I'd love to hear it.
I see nothing on google on the phrase "cash-out mortgage" that another poster used, but I find many references to "cash-out refinance" referring to situations where the house is paid off and a new mortgage is taken out.
Just speculating, but perhaps since the vast majority of situations involving cash-out transactions are refinancing of existing debt, the same term has been adopted for this far less common but similar cash-out transaction?
