A cash out refinance lets you tap into the equity you have built in your home while refinancing your existing mortgage into a new loan. The process is similar to your original home purchase loan.
The amount available depends on your home value, current loan balance, and loan program. Most conventional cash out loans allow you to borrow up to 80% of your home value.
A cash out refinance goes through complete underwriting including income verification, credit review, and a new appraisal to confirm your home value.
Once the loan closes, the cash is yours to use however you choose. Common uses include home improvements, debt consolidation, and major expenses.
Because you are borrowing more than you currently owe, your new loan balance and monthly payment will generally be higher than before.
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This program works well for homeowners who have built meaningful equity and have a clear purpose for the funds.
Homeowners who want to use their equity to fund renovations that add value and improve their quality of life.
Borrowers carrying high interest credit card or personal loan debt who want to consolidate into a single lower rate payment.
Homeowners who need access to funds for education, medical expenses, or other significant financial goals.
Straight answers to the questions we hear most often.
It is a refinance where you borrow more than what you currently owe on your mortgage and receive the difference as cash. The new loan replaces your existing one.
The amount depends on your home value, current loan balance, and loan type. Most conventional loans allow you to borrow up to 80% of your home value. FHA and VA programs have their own limits.
There are no restrictions on how you use the funds. Common uses include home improvements, debt consolidation, education costs, and large expenses.
It depends on your new loan amount, rate, and term. In some cases borrowers lower their rate while still accessing equity, but your payment will generally reflect the larger loan balance.
No. A home equity loan is a second loan added on top of your existing mortgage. A cash out refinance replaces your mortgage entirely with one new loan.
