Cash-out refinance
A cash-out refinance turns your home equity into usable cash.
A cash-out refinance replaces your existing mortgage with a new, larger loan and delivers the difference to you in cash at closing. It's available on Conventional, FHA, and VA loans, and it's often the cleanest way to tap significant equity when you're also open to changing your first-mortgage rate or term.
How does a cash-out refinance work?
A cash-out refinance pays off your existing first mortgage and replaces it with a new, larger loan. The difference between the new loan amount and what you owed on the old mortgage — minus closing costs — is delivered to you as cash at closing.
For example, if you owe $200,000 on your current mortgage and your home appraises for $400,000, a cash-out refinance up to 80% LTV could give you a new loan of $320,000 — paying off the old $200,000 and delivering roughly $120,000 in cash (before closing costs).
How much cash can you take out?
Cash-out limits depend on the loan program: Conventional cash-out is generally capped at 80% loan-to-value (LTV) on a primary residence. FHA cash-out is capped at 80% LTV. VA cash-out can go up to 90% LTV (and 100% in some cases for veterans with full entitlement).
Investment property and second home cash-out limits are typically lower (usually 70% – 75%).
When does a cash-out refinance make sense?
A cash-out refi tends to make sense when: current mortgage rates are at or below your existing rate; you need a large lump sum (over ~$50K); and you want a single fixed payment rather than a second-lien HELOC or home equity loan.
When rates are much higher than your current mortgage, a HELOC or home equity loan often makes more sense — you keep the low rate on your first mortgage and add a smaller second lien for the cash you need.
Key benefits
- One consolidated mortgage payment — no second lien to manage
- Available on Conventional, FHA, and VA
- Fixed-rate options available
- Cash delivered at closing — use for home improvement, debt consolidation, education, or investment
- VA cash-out for eligible veterans can go up to 90% – 100% LTV
Who this loan fits best
- Homeowners with significant equity who want a single consolidated payment
- Borrowers whose current rate is at or above today's rates
- Veterans using VA cash-out for higher LTV access
- Anyone consolidating high-interest debt or funding major renovations
Estimate your monthly payment
Cash-Out Refi payment calculator
Estimate only. Actual rate, taxes, insurance, and mortgage insurance depend on your specific loan and property. Belong Lending confirms your exact payment at pre-approval.
Serving Detroit and surrounding Michigan communities
Belong Lending helps borrowers with Cash-Out Refi loans across Detroit, Troy, Southfield, Ann Arbor, Flint, Livonia, Warren, Sterling Heights, Farmington Hills, Novi, Rochester Hills, Dearborn, and beyond — plus additional coverage throughout Wayne County, Oakland County, Macomb County, Washtenaw County, Livingston County, Genesee County. We also lend on eligible properties in Ohio, Florida, Georgia, and Texas.
Frequently asked questions
What is the maximum I can cash-out refinance?
Conventional and FHA cash-out are capped at 80% loan-to-value on a primary residence. VA cash-out can go up to 90% (and up to 100% for eligible veterans in some cases). Investment properties are capped lower, typically 70% – 75% LTV.
Does a cash-out refinance affect my credit score?
The hard credit inquiry at application will cause a small, temporary dip in your credit score. Long term, replacing existing debt with lower-rate mortgage debt often improves credit utilization ratios and can help your score.
Is cash-out refinance interest tax-deductible?
Cash-out interest is deductible when the cash is used to buy, build, or substantially improve the home securing the loan. Interest on the portion used for non-home purposes (debt payoff, etc.) is generally not deductible. Confirm your situation with a tax advisor.
How long does a cash-out refinance take?
Most cash-out refinances close within 30 – 45 days. VA cash-outs sometimes close faster because appraisals can be quicker to schedule. Belong Lending manages the timeline from application to closing.
Cash-out refinance vs. HELOC — which is better?
Cash-out refi consolidates everything into a single mortgage payment and is often the right choice when today's rates are at or below your current rate. HELOC keeps your low first-mortgage rate intact and adds a second lien — usually better when rates today are meaningfully higher than what you have.