Cash-Out Refinance: Tap Your Equity
Replace your current mortgage with a new, larger loan and receive the difference in cash. New rate and term. Best when rates are attractive and you want a large lump sum or to reset your term. Compare rates below.
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Cash-Out Refinance Highlights
Replace your first mortgage with a new, larger loan. You get one new rate, one new term, and cash at closing. Often lower rate than a second lien—but resets your mortgage.
Replaces your mortgage
One new first mortgage replaces your current one. You get a new rate and term, plus cash at closing.
Often lower rate
First-lien rates can be lower than second liens (HELOC, home equity loan). Compare the new payment to your total cost today.
Single loan
One mortgage, one payment. No second lien—simpler than adding a HELOC or home equity loan.
2–5% closing costs
Expect appraisal, title, origination, recording. Some lenders offer no-closing-cost options (roll into loan or higher rate).
Why a Cash-Out Refinance Works
When rates are attractive and you want a large lump sum—major renovation, debt consolidation—a cash-out refi can deliver more than a HELOC or home equity loan, often at a lower rate.
Lower rate potential
First-lien rates often beat second liens; can lower overall cost.
Large lump sum
Big lump sum for renovation or debt consolidation.
Reset your term
Extend or shorten term—30-year lowers payments; shorter shortens payoff.
Cash-Out Refinance At a Glance
Closing costs
Expect 2–5% of the loan amount. Appraisal, title, origination, recording. No-closing-cost options by rolling into loan or slightly higher rate.
Cash-out refi guide →Timeline
Full mortgage underwriting—typically 30–45 days. Longer than HELOC (2–4 weeks) or home equity loan (3–5 weeks).
Have pay stubs, tax returns, and mortgage statement ready to speed things up.
Cash-out vs alternatives
Prefer to keep your mortgage? A HELOC or home equity loan adds a second lien without replacing your first.
Compare all options →Compare Home Equity Options
| Feature | HELOC | Home Equity Loan | Cash-Out Refi |
|---|---|---|---|
| Payout | Revolving Line | Lump Sum | New Mortgage |
| Interest Rate | Variable | Fixed | Fixed |
| First Mortgage Rate | Untouched | Untouched | Replaced |
| Best For | Ongoing renovations | One-time projects | Debt overhaul |
| Time to Close | 2–4 weeks (Fastest, often no full appraisal) | 3–5 weeks (Requires more verification) | 30–45 days (Full mortgage underwriting process) |
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