Cash-Out Refinance Calculator: How Much Cash Can You Get?
Cash-out refinance calculator
Closing costs of 3% are an example to test with; actual costs vary. VA loans may include a funding fee unless you're exempt.
Estimate only, based on the values you entered. Assumes you borrow the maximum and pay closing costs from the loan. Excludes taxes, insurance and mortgage insurance. Not a loan offer.
How the cash-out refinance calculator works
| Step | Formula |
|---|---|
| 1. Maximum new loan | Home value × maximum LTV for your program |
| 2. Estimated closing costs | New loan amount × closing-cost percentage |
| 3. Cash you could receive | Maximum new loan − current mortgage balance − closing costs |
| 4. New payment | Standard principal-and-interest formula on the new loan amount, rate and term |
Tips for accurate cash-out refinance calculator results
- Use a realistic home value. Look at recent sales of similar homes nearby rather than the highest online estimate. The appraisal will set the final number.
- Use your payoff amount, not just your balance. Your payoff includes accrued interest and can be slightly higher than the balance on your statement.
- Include every lien. If you have a HELOC or second mortgage that will be paid off, add it to your current balance.
- Test a few closing-cost percentages, such as 2%, 3% and 4%, to see a range.
- Try more than one rate. Run the payment at a couple of rates to see how sensitive it is.
- Remember escrow. The payment shown is principal and interest only; taxes, insurance and any mortgage insurance are added on top.
The FHFA's House Price Index can help you see how values have changed in your area.
Cash-out refinance example
Hypothetical example for illustration only. Rates and costs are not quotes.
A home is worth $450,000 with a $250,000 mortgage balance.
| Conventional / FHA (80%) | VA (90%) | |
|---|---|---|
| Maximum new loan | $360,000 | $405,000 |
| Closing costs at 3% | $10,800 | $12,150 |
| Estimated cash out | $99,200 | $142,850 |
| Payment at a hypothetical 6.75%, 30 years | About $2,335/mo | About $2,627/mo |
VA loans may also include a funding fee unless you're exempt, which isn't included above.
Cash-out refinance LTV limits by loan type
| Loan type | Typical max LTV | Good to know |
|---|---|---|
| Conventional | Generally 80% on a single-unit primary home | Lower limits for multi-unit homes, second homes and investment properties |
| FHA | Generally 80% | Mortgage insurance applies; see the HUD handbook |
| VA | Up to 90% with the lenders we work with | For eligible veterans and service members; see the VA cash-out refinance page |
Lenders may set lower limits depending on your credit, loan amount and property.
Cash-out refinance vs rate-and-term refinance
| Cash-out refinance | Rate-and-term refinance | |
|---|---|---|
| Goal | Take cash out of your equity | Change your rate or term without taking cash |
| New loan amount | Larger than your current balance | About the same as your current balance plus costs |
| Max LTV | Lower (generally 80% conventional and FHA) | Usually higher |
| Pricing | Often slightly higher rates than rate-and-term | Often slightly lower |
If you only want a lower rate, a rate-and-term refinance is usually cheaper. Choose cash-out when you actually need the money, and take only the amount you have a clear plan for, since every extra dollar adds to your balance and interest.
How a cash-out refinance changes your payment and total interest
Hypothetical example for illustration only. Rates are not quotes.
A homeowner owes $250,000 and takes out $80,000, for a new $330,000 loan (plus closing costs) at a hypothetical 6.75% over 30 years.
| Amount | |
|---|---|
| New principal + interest payment on $330,000 | About $2,140/mo |
| Total interest over 30 years if held to term | About $441,000 |
| Same loan on a 20-year term | About $2,509/mo, with about $272,000 total interest |
A shorter term raises the payment but saves a lot of interest. Paying extra toward principal each month works the same way on a 30-year loan without locking you into the higher payment.
How to get a cash-out refinance: step by step
- Estimate your cash with the calculator above, using a conservative home value.
- Check your credit for free at AnnualCreditReport.com and fix any errors.
- Compare offers. Look at rate, APR, closing costs and cash to you on each Loan Estimate.
- Apply and provide documents: pay stubs, W-2s or tax returns, bank statements, your mortgage statement and insurance details.
- Appraisal. The lender orders an appraisal unless your loan qualifies for a waiver.
- Underwriting and closing. Review your Closing Disclosure at least three business days before closing.
- Receive your cash after the three-business-day right-to-cancel period on a primary residence.
VA cash-out refinance: what veterans should know
- Eligible veterans, service members and some surviving spouses can use a VA-backed cash-out refinance, with a valid Certificate of Eligibility.
- You can refinance a non-VA loan into a VA loan and take cash out at the same time.
- The lenders we work with allow up to 90% LTV on VA cash-out refinances.
- A VA funding fee applies unless you're exempt, for example if you receive VA disability compensation.
- You must live in the home. See the VA cash-out refinance page for eligibility details.
When a cash-out refinance may not make sense
- Your current rate is well below today's rates and you only need a modest amount; a HELOC or home equity loan is usually cheaper.
- You plan to sell within a couple of years, so you won't recoup the closing costs.
- The cash would fund spending that doesn't improve your financial position.
- The new payment would stretch your budget.
Is a cash-out refinance worth it?
A cash-out refinance replaces your entire mortgage, so the new rate applies to your whole balance, not just the cash you take out. It tends to make sense when:
- Today's rates are close to or below your current mortgage rate.
- You want one loan and one payment instead of a mortgage plus a second lien.
- You want to lock a fixed rate on everything.
- You're a veteran who can use the higher VA LTV limit.
If your current rate is much lower than today's, a HELOC or home equity loan often costs less overall because it leaves your first mortgage alone. Our cash-out refinance vs HELOC guide walks through a full example.
Closing costs on a cash-out refinance
Because it's a full new mortgage, a cash-out refinance has closing costs similar to a purchase loan. Common costs include:
- Lender origination and underwriting fees
- Appraisal fee (waivers are available on some loans)
- Title search and lender's title insurance
- Recording fees and any local taxes
- Prepaid interest, and escrow for taxes and insurance
- FHA mortgage insurance premiums or the VA funding fee, where applicable
You'll receive a Loan Estimate that lists these costs within three business days of applying, which makes it easier to compare lenders side by side.
What you can use cash-out refinance money for
- Debt consolidation: paying off credit cards or personal loans. See our guide to a home equity loan for debt consolidation for the risks and trade-offs.
- Home improvements that may add value to the property.
- Education costs or other large expenses.
- Buying out a co-owner, such as after a divorce.
- An emergency reserve, though a HELOC may be cheaper for money you might not use.
How to qualify for a cash-out refinance
| Requirement | What lenders look for |
|---|---|
| Equity | Enough that the new loan stays within the program's max LTV |
| Credit | Program and lender minimums; FHA and VA can be more flexible than conventional |
| Debt-to-income ratio | Your monthly debts, including the new payment, compared with income. The CFPB explains how DTI works. |
| Seasoning | Many programs require you to have owned the home, or had your current loan, for a minimum time |
| Appraisal | Usually required to confirm value |
Alternatives to a cash-out refinance
- HELOC: a line of credit that keeps your first mortgage. See HELOC requirements.
- Home equity loan: a fixed-rate lump sum that also keeps your first mortgage. Compare in HELOC vs home equity loan.
- Fixed-rate HELOC: flexibility plus a fixed payment. See fixed-rate HELOC.
Estimate how much equity you could borrow without refinancing using our home equity calculator.
Documents you'll need
- Recent pay stubs and W-2s, or two years of tax returns if you're self-employed
- Recent bank and asset statements
- Your current mortgage statement, plus statements for any other liens being paid off
- Homeowners insurance declarations page
- Government-issued photo ID
- For VA loans, your Certificate of Eligibility (your lender can often request it for you)
Having these ready before you apply helps keep your closing on schedule. If anything changes during the process, such as a new job or a large deposit, tell your loan officer right away so it doesn't delay underwriting.
Taxes on cash-out refinance money
Cash you receive from a refinance isn't income, so it generally isn't taxed. Interest on the cash-out portion is generally deductible only if you itemize and use the money to buy, build or substantially improve the home. See IRS Publication 936 and ask a tax professional.
Frequently asked questions
How much cash can I get from a cash-out refinance?
Multiply your home's value by the program's maximum LTV, then subtract your current balance and closing costs. For example, a $450,000 home at 80% LTV with a $250,000 balance and 3% closing costs could yield about $99,000.
What is the maximum LTV for a cash-out refinance?
Conventional and FHA cash-out refinances are generally capped at 80% LTV on a primary residence. VA cash-out refinances can go up to 90% with the lenders we work with.
How much are closing costs on a cash-out refinance?
Costs vary by lender, loan size and location. The calculator uses 3% as an example setting; your Loan Estimate will show actual costs.
Does a cash-out refinance raise my monthly payment?
Usually, because you're borrowing more. It can stay similar or drop if today's rate is lower than your current rate or you choose a longer term.
How long does a cash-out refinance take?
Often 30 to 45 days from application to closing, depending on the appraisal and underwriting. You typically receive the cash a few business days after closing.
Is cash-out refinance money taxable?
Generally no, because it's borrowed money rather than income. Interest deductibility depends on how you use the funds.
Can I do a cash-out refinance on an investment property?
Yes, with some programs, but LTV limits are lower and rates are usually higher than for a primary residence.
Can I get cash out without refinancing?
Yes. A HELOC or home equity loan lets you borrow against your equity while keeping your current mortgage and its rate.
How soon can I do a cash-out refinance after buying a home?
Many programs require a waiting period, often several months to a year of ownership or payments on the current loan. Requirements vary by loan type and lender.
Do I need an appraisal for a cash-out refinance?
Usually yes, though some conventional loans qualify for an appraisal waiver based on existing property data.
Does using this calculator affect my credit?
No. The calculator runs in your browser and doesn't pull credit or collect personal information.
Related guides and tools
Sources
- U.S. Department of Veterans Affairs: Cash-out refinance loan
- U.S. Department of Housing and Urban Development: Single Family Housing Policy Handbook 4000.1
- Consumer Financial Protection Bureau: What is a debt-to-income ratio?
- Internal Revenue Service: Publication 936, Home Mortgage Interest Deduction