Calculate cash-out refinance proceeds, new payment, LTV, and compare costs against your current mortgage. See PMI thresholds and scenario analysis.
A cash-out refinance replaces your existing mortgage with a new, larger loan — allowing you to pocket the difference as cash. It is a way to access your home equity for renovations, debt consolidation, investments, or major expenses while potentially adjusting your mortgage rate and term.
The key considerations are: how much cash you can extract, what the new payment will be, and whether the total cost (higher loan, closing costs, potentially higher rate) justifies the benefit. Lenders typically allow cash-out refinancing up to 80% loan-to-value (LTV), though some programs go to 90% with PMI.
This calculator models the complete cash-out refinance scenario. Enter your current mortgage details and proposed new loan to see cash proceeds, payment changes, LTV impact, and a detailed cost comparison. The LTV scenarios table shows maximum cash-out at different equity levels, helping you evaluate how much to extract while maintaining a healthy equity cushion. Check the example with realistic values before reporting.
Cash-out refinancing involves significant trade-offs that are easy to miscalculate. This calculator shows the full picture: how much cash you actually receive after closing costs, how your payment changes, and whether the additional interest cost is worth it. The LTV analysis helps you avoid over-leveraging your home. Keep these notes focused on your operational context.
Cash Out = New Loan Amount − Current Balance − Closing Costs. LTV = New Loan / Home Value × 100. New Payment = New Loan × [r(1+r)^n] / [(1+r)^n − 1].
Result: Cash out: $122,000 — New payment: $2,270/mo — LTV: 77.8% — No PMI
Refinancing from a $220K balance to a $350K loan at 6.75% yields $122,000 cash ($350K − $220K − $8K closing). The new payment is $2,270/mo. LTV of 77.8% stays below the 80% PMI threshold, and you retain $100K in equity.
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Most lenders allow cash-out up to 80% of your home value minus closing costs. Some programs allow up to 90% with PMI. VA loans may allow up to 100%. Your actual limit depends on your credit, income, and lender guidelines.
The cash received is not taxable income — it is loan proceeds, not earnings. However, the interest on the new loan is only tax-deductible to the extent it is used for home improvements (under current tax law). Consult a tax professional.
A cash-out refi replaces your entire mortgage with a new loan. A HELOC is a second lien (revolving credit line) on top of your existing mortgage. Cash-out refi typically has lower rates but higher closing costs. HELOCs are more flexible for ongoing needs.
Yes, typically 0.125–0.50% higher than a standard rate-and-term refinance. The rate premium reflects the higher risk to the lender due to the increased loan amount and reduced equity.
Typically 30–60 days from application to closing. Cash-out refinances have slightly longer timelines than regular refinances due to additional underwriting requirements and, in some states, mandatory waiting periods.
The main risks are: reduced equity (less cushion if home values drop), higher monthly payment, more total interest over the life of the loan, and potential for negative equity if the market declines. Only cash out what you truly need.