8Twelve Mortgage US
Cash-out refinance

Cash-out refinance.
Put your equity to work.

A cash-out refinance replaces your current mortgage with a larger one and pays you the difference in cash at closing. How much you can take depends on your home's value and the program's maximum loan-to-value, commonly 80% on a conventional or FHA loan for a home you live in. It makes most sense when today's rate is close to yours.

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3-minute form. A soft-credit rate estimate.

Last updated: October 2026

80%
Common cap, conventional and FHA
Higher
For eligible VA borrowers
40+
Lender network

Before we talk about cash-out, we ask one question: what is the rate on your mortgage now? If it is low, refinancing the whole balance to reach the equity can cost more than it is worth, and we will show you a HELOC or home equity loan instead. If it is close to today's market, a cash-out refinance gives you one loan, one payment and the cash in hand. We structure the file and place it across our 40+ lender network.

Who it's for

A fit if you're…

  • Holding meaningful equity from appreciation or years of payments
  • Paying a current rate close to, or above, what the market offers now
  • Funding a renovation, tuition or a down payment on another property
  • Clearing higher-rate balances into one secured payment
  • Wanting a single fixed payment rather than a first mortgage plus a line

One loan, one payment

The new mortgage pays off the old one and funds the cash, so there is no second lien to manage.

Conventional, FHA, VA or non-QM

Each has its own cap, credit rules and costs. We match the file to the right one.

Fixed-rate options

Lock the full balance, including the cash, at a fixed rate for the term.

We compare against a HELOC

If keeping your first mortgage is cheaper, we say so and show you the numbers.

Run it yourself first

The cash-out refinance calculator sizes the cash and payment with your own rate.

Broker, not lender

8Twelve arranges the loan; a lender partner makes it. We compare overlays so one bank's rules do not decide for you.

How much a cash-out refinance can give you

Take the appraised value, multiply by the program's maximum loan-to-value, and subtract what you owe. That is the gross cash. Closing costs come out of it unless you pay them separately. Taking less than the maximum keeps a cushion of equity and usually improves pricing. The cash-out refinance calculator runs this with your own numbers and the rate you have been quoted.

Illustrative example only

Round numbers, chosen to show the math rather than to reflect any particular lender or file. Your figures, program and pricing will differ.

Illustrative conventional cash-out refinance on a $600,000 home
Appraised value$600,000
Maximum loan at 80%$480,000
Current mortgage payoff$320,000
Gross cash available$160,000
Less closing costs (example)-$10,000
Approximate cash to you$150,000

If this homeowner only needs $60,000, borrowing $390,000 instead of $480,000 keeps far more equity in the home and lowers the payment.

For illustration only. Not a commitment to lend, a rate lock or an offer of credit. Terms vary by lender, by property and by file.

Open the cash-out calculator

Conventional, FHA and VA cash-out compared

The program sets the cap, the credit expectations and the costs. Most borrowers fit at least one; some fit all three, and the cheapest is not always the obvious one once mortgage insurance and fees are counted.

Conventional, FHA and VA cash-out refinance compared
AttributeConventionalFHAVA
Common cap, primary home80% (1 unit)80%Up to 100% under VA rules; lenders often cap lower
OccupancyPrimary, second home or rentalPrimary home, 12 monthsPrimary home
Mortgage insuranceNone at 80% or belowUpfront and annualNone; one-time funding fee
CreditStricterMore flexibleLender-set; no VA minimum
Who it suitsStrong credit, 20%+ equityLower scores, primary homeEligible veterans and service members
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FHA cash-out refinance

FHA cash-out is the route for homeowners whose credit or debt-to-income ratio does not fit conventional guidelines comfortably. It can refinance any existing mortgage, not only an FHA loan, up to 80% of the appraised value. The trade-off is mortgage insurance: an upfront premium, usually rolled into the loan, and an annual premium paid monthly. On a strong-credit file with 20% or more equity left, conventional is often cheaper for that reason alone. If you already have an FHA loan and only want a lower rate, an FHA streamline refinance is simpler. For the purchase side of the program, see FHA loans, and for the full rules and a worked example, read our FHA cash-out refinance guide.

  • Primary residence only, owned and occupied for the last 12 months
  • On-time mortgage payments for the last 12 months
  • Maximum 80% of the appraised value
  • Upfront and annual FHA mortgage insurance premiums
  • Lenders set their own credit minimums above the FHA floor
See what you qualify for

Cash-out refinance or HELOC

The deciding number is the rate you already have. A cash-out refinance reprices your whole balance, so if your current rate is well below today's market, you pay more on money you already borrowed just to reach the new cash. A HELOC or a fixed home equity loan leaves the first mortgage alone and prices only what you take. When your current rate is similar to or above the market, the cash-out refinance usually wins on simplicity and often on cost. We run both before recommending either.

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What people use the cash for

The strongest uses either add value or remove expensive debt. Renovations that raise the home's value. Paying off credit cards and personal loans, covered in detail on our cash-out for higher-rate debt page. A down payment on a rental, where an investment property refinance may come next. The weakest uses are things that lose value, because you will be paying for them over decades.

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What you'll need

Conventional, FHA and VA cash-out are full-documentation loans: recent pay stubs, W-2s or tax returns, two months of bank statements, your current mortgage statement, ID and homeowners insurance. Self-employed borrowers whose returns understate their income can refinance on deposits with bank statement loans, and other routes are on our non-QM home loans page. More explainers are in the mortgage guides.

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Things to weigh

  • Pulling equity leaves less cushion if home values fall. Taking less than the maximum is often the better structure.
  • Rolling short-term debt into a 30-year loan can cost more in total interest unless you pay it down faster.
  • A new 30-year term resets the clock on a loan you may have been paying for years.
  • Cash-out pricing is usually somewhat higher than rate-and-term pricing for the same file.
  • Caps, credit minimums and costs vary by program and lender. Terms are available across our lender network, and nothing here is an offer to lend.
FAQ

Questions buyers actually ask

How much equity can I cash out?+

Multiply your home's appraised value by the program's maximum loan-to-value and subtract what you owe. Conventional and FHA cash-out on a primary home are commonly capped at 80%. VA cash-out can go higher for eligible borrowers. Rentals are lower, commonly 70% to 75%. Closing costs come out of what is left.

How does an FHA cash-out refinance work?+

An FHA cash-out refinance replaces your current mortgage, FHA or not, with a new FHA loan of up to 80% of the home's value. You must have owned and lived in the home as your primary residence for the last 12 months, with on-time mortgage payments over that period. FHA mortgage insurance applies, both upfront and annually.

What are the Fannie Mae cash-out refinance rules?+

A conventional cash-out loan sold to Fannie Mae is commonly capped at 80% loan-to-value on a single-unit primary home, with lower caps on 2-4 unit homes, second homes and rentals. The existing mortgage generally has to be seasoned, commonly 12 months, before a cash-out. Lenders can add their own requirements on top.

Can I do a cash-out refinance on an investment property?+

Yes. Conventional loans allow it at lower leverage, and DSCR loans allow it without tax returns. Our investment property refinance page compares the programs, and the DSCR cash-out refinance page covers qualifying on the rent.

Is cash-out refinance money taxable?+

No. It is loan proceeds, not income. Interest may be deductible when the money is used to buy, build or substantially improve the home that secures the loan. Talk to a tax professional about your own situation.

Cash-out refinance or HELOC: which is better?+

A cash-out refinance replaces the whole mortgage, usually at a fixed rate. A HELOC adds a second lien you draw from over time, usually at a variable rate. If your current rate is lower than what a new loan would cost, the HELOC or a fixed home equity loan usually costs less because it leaves the first mortgage alone.

Is the rate higher on a cash-out refinance?+

Usually somewhat higher than on a rate-and-term refinance with the same credit and leverage, because lenders price cash-out as slightly riskier. We do not publish rates. A fit check shows you both side by side for your own file.

How long does a cash-out refinance take?+

Commonly 30 to 45 days from application to closing, with the appraisal being the main variable. On a primary residence, federal rules give you a three-business-day right to cancel after signing, so the cash arrives a few days after closing.

Can I get a cash-out refinance with bad credit?+

Sometimes. FHA cash-out is generally more flexible on credit than conventional, and select non-QM programs consider lower scores. Expect lower maximum leverage and higher pricing. A lender's own minimum often sits above the program's, which is why placing the file matters.

See what your equity can do.

A 3-minute application. A soft-credit rate estimate. We structure and place your file with the lender that fits it.

See My Cash-Out OptionsTalk to a loan specialist
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