Overview
A cash-out refinance lets you replace your current mortgage with a larger one and take the difference as cash at closing. It's often used for renovations, paying off higher-rate debt, or funding investment properties.
Benefits
- Lump-sum cash at closing
- Often lower rate than personal loans or credit cards
- Tax-deductible interest in some cases (consult a CPA)
- Single payment vs. juggling multiple debts
Eligibility
- Generally 20% equity remaining after refinance
- Stable income and credit
- Sufficient appraised value
Cincinnati scenario
An Oakley homeowner with $180,000 in equity uses a cash-out refi to fund a $60,000 kitchen renovation while keeping a competitive blended rate.
Frequently Asked Questions
Most conventional cash-out refinances allow you to cash out up to 80% of your home's appraised value. VA cash-out can go higher for eligible borrowers.