How this calculator works
The new loan can't exceed the home's value times the lender's maximum LTV. Your current balance and closing costs come off that limit, and the rest is the most cash you can take. The new payment is calculated on the larger loan at the new rate and term.
Worked example
With the example values below: Maximum cash out, $140,000 (at 80% loan-to-value). Change any number above to run your own.
What you enter
| Input | Example |
|---|---|
| Home value | $500,000 |
| Current mortgage balance | $250,000 |
| Max loan-to-value | 80% |
| Closing costs% of new loan | 2.5% |
| New rate | 6.5% |
| New term | 30 years |
| Cash you want | $80,000 |
How a cash-out refinance works
A cash-out refinance replaces your mortgage with a larger one and pays you the difference in cash. If your home is worth $500,000 and you owe $250,000, a new $380,000 loan pays off the old one and gives you about $130,000 minus closing costs.
Lenders cap the new loan at a maximum loan-to-value ratio, usually 80% for conventional loans, 80% for FHA and up to 90% for VA. Your current balance and closing costs come out of that limit, and what's left is the most cash you can take.
Cash-out refinance vs. HELOC vs. home equity loan
If your existing mortgage has a low rate, a cash-out refinance replaces it with today's rate on the whole balance, which can cost far more than the cash is worth. In that case a home equity loan or HELOC usually costs less.
| Option | Rate | Best when |
|---|---|---|
| Cash-out refinance | Fixed or adjustable, on the whole loan | Your current rate is similar to or higher than today's rates |
| Home equity loan | Fixed, on the new amount only | You have a low first-mortgage rate and need a lump sum |
| HELOC | Variable, interest only during the draw | You need money over time or aren't sure how much |
Good and risky uses of the cash
Your home secures the loan, so missing payments can lead to foreclosure. Interest on the cash-out portion is only tax-deductible if the money is used to buy, build or substantially improve the home, and only if you itemize.
- Usually reasonable: home improvements that add value, paying off high-interest debt with a plan not to run it back up, or a large necessary expense.
- Riskier: vacations, cars and everyday spending, which turn short-term costs into 30 years of mortgage debt.
Costs to expect
Closing costs on a cash-out refinance are typically 2% to 5% of the new loan, and conventional cash-out loans carry pricing adjustments that make the rate a bit higher than a standard refinance. The refinance calculator can help compare a plain rate-and-term refinance with taking cash out.
Frequently asked questions
How much cash can I get from a cash-out refinance?
Usually up to 80% of your home's value minus your current balance and closing costs. On a $500,000 home with a $250,000 balance, that's up to $150,000 before closing costs.
Is a cash-out refinance a good idea?
It can be if today's rate is close to or below your current rate and you're using the money for something valuable, like home improvements or replacing high-interest debt. If your current rate is much lower, a HELOC or home equity loan is usually cheaper.
What credit score do I need for a cash-out refinance?
Most conventional lenders want at least 620, and better pricing starts around 680 to 740. FHA cash-out refinances may allow lower scores.
Is cash from a refinance taxable?
No. Cash from a refinance is borrowed money, not income, so it isn't taxed. Interest on the cash-out portion is deductible only if you itemize and use the money to buy, build or substantially improve your home.
How long does a cash-out refinance take?
Typically 30 to 45 days from application to closing, including the appraisal and underwriting. Funds arrive after the three-day right-to-cancel period on a primary residence.
Grow what this calculator projects.
TruthSayer AI sends quantitative stock signals across valuations, earnings and dark-pool activity, each one traded in its own funded account first.
Estimates for planning only, not financial, tax or legal advice. Tax tools use 2026 federal figures (brackets, $16,100 / $32,200 standard deduction, $19,000 gift exclusion, $15M lifetime exemption). Rates shown as defaults are examples; replace them with quotes you actually receive.