Cash-Out Refinance Tap equity. Keep the mortgage.
Access home equity for renovation, debt consolidation, tuition, or whatever the next chapter needs.
Tap your home equity by refinancing for more than you owe.
A cash-out refinance replaces your existing mortgage with a larger one and gives you the difference in cash at closing. It's the same as any refinance — new appraisal, new underwriting, new closing — except the new loan amount exceeds the payoff of the old loan.
The cash you receive is yours to use however you want. Common uses: debt consolidation, home improvements, education, business capital, or investment.
An example
Say you have a $200,000 balance on a home worth $400,000. You qualify to refinance up to 80% loan-to-value, or $320,000. The new loan pays off the $200,000 you owe and gives you $120,000 in cash, minus closing costs.
When cash-out makes sense
- Consolidating high-interest debt. Mortgage rates are usually meaningfully lower than credit-card or personal-loan rates. Rolling that debt into a refinance can dramatically lower your monthly debt service.
- Renovations that increase home value. Kitchens, bathrooms, additions — improvements that meaningfully raise market value can make sense to finance against the home itself.
- Investing in a second property. Using equity from a primary residence to fund a down payment on a rental or vacation home.
- Major one-time expenses. Education, medical bills, business capital — anywhere the rate spread makes a cash-out cheaper than alternative borrowing.
What to weigh
- You'll owe more on the home. A larger balance means you've extended your debt and likely your payoff timeline.
- Closing costs apply. Typically 2–5% of the new loan amount.
- Equity required. Most lenders cap cash-out at 80% loan-to-value (some VA loans go higher).
- The rate may be slightly higher than a rate-and-term refinance because of the additional risk.
How it works
- Available on conventional, FHA, VA, and jumbo loans.
- New appraisal determines current home value.
- 80% loan-to-value cap on most programs (VA can go to 100% in some scenarios).
- New 30- or 15-year amortization on the full balance.
Considering using your equity? Reach out — we'll model the new payment, the cash you'd receive, and the all-in cost so you can decide with the math in front of you.
Get started today!
Tell us a little about your situation and we'll send personalized loan options within one business day.
Cash-Out Refinance FAQs
How much equity can I cash out?
Most conventional cash-out refinances cap out at 80% loan-to-value. VA cash-out can go up to 100% LTV in some cases. FHA cash-out caps at 80% LTV.
Is the cash taxable?
Generally no — cash-out proceeds are loan proceeds, not income. Interest may be deductible if used for home improvements (consult your tax advisor).
Cash-out refinance vs HELOC — which is better?
Cash-out refinances replace your existing first mortgage with a larger one, locking in a single fixed rate. HELOCs are second liens with variable rates that let you draw and repay as needed. We'll compare both for your scenario.