What are current cash-out refinance rates?

Cash-out refinance rates in February 2026 average 6.35% for a 30-year fixed — about 0.25% higher than a standard rate-and-term refinance (6.10%). For 15-year fixed, cash-out rates average 5.75%. With 740+ credit and keeping LTV under 70%, you can get rates as low as 6.10-6.15%. VA cash-out refinances are available at 5.90% with 100% LTV.

How much cash can I get from a cash-out refinance?

Most lenders allow up to 80% loan-to-value (LTV) for cash-out refinance. Example: Home worth $500,000, current mortgage $250,000. At 80% LTV: $500,000 × 80% = $400,000 new loan - $250,000 payoff = $150,000 cash out. The average US homeowner has $299,000 in tappable equity (as of Q4 2025). VA loans allow 100% LTV cash-out refinance.

Cash-out refinance vs HELOC: which is better?

Cash-out refinance is better if: your current rate is higher than today's rates (you lower your rate AND get cash), you want a fixed rate and predictable payment, or you need a large lump sum. HELOC is better if: your current rate is lower than today's rates (don't want to refinance into a higher rate), you need flexible access to funds over time, or you need a smaller amount ($25K-$75K). Current rates: cash-out refi 6.35%, HELOC 7.0%.

Cash-Out Refinance Rates 2026: Current Rates & How Much You Can Get

Current Cash-Out Refinance Rates (February 2026)

Loan Type	Cash-Out Rate	Standard Refi Rate	Premium
30-Year Fixed	6.35%	6.10%	+0.25%
15-Year Fixed	5.75%	5.50%	+0.25%
5/1 ARM	6.00%	5.75%	+0.25%
VA Cash-Out	5.90%	5.65%	+0.25%
FHA Cash-Out	6.10%	5.85%	+0.25%

Rates for 740+ credit, 70% LTV. Your rate depends on credit score, LTV, and loan amount. Feb 13, 2026.

How Much Cash Can You Get?

Home Value	Current Mortgage	Max New Loan (80%)	Cash Available
$350,000	$200,000	$280,000	$80,000
$450,000	$250,000	$360,000	$110,000
$550,000	$300,000	$440,000	$140,000
$700,000	$350,000	$560,000	$210,000
$1,000,000	$500,000	$800,000	$300,000

Calculate your available equity →

Cash-Out Refi vs HELOC vs Home Equity Loan

Feature	Cash-Out Refi	HELOC	Home Equity Loan
Current Rate	6.35%	7.00%	7.50%
Rate Type	Fixed	Variable	Fixed
Max LTV	80%	85%	85%
Replaces Existing Mortgage	Yes (single payment)	No (2nd payment)	No (2nd payment)
Closing Costs	$3,000-$6,000	$0-$500	$2,000-$5,000
Best For	Large lump sum + rate improvement	Flexible, ongoing access	Fixed amount, predictable payments
Interest Deductible	Yes (if used for home improvement)	Yes (if used for home improvement)	Yes (if used for home improvement)

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Cash-Out Refi Rates →HELOC Rates →

When Cash-Out Refinance Makes Sense

✓ Good Reasons to Cash Out

• Home renovations that increase value (ROI: 60-80%)
• Pay off high-interest debt (20%+ credit cards → 6.35% mortgage)
• Your current rate is HIGHER than 6.35% (you save + get cash)
• Emergency fund or major medical expenses
• College tuition (lower rate than most student loans)
• Investment property down payment (leverage equity to build wealth)

✗ Bad Reasons to Cash Out

• Vacation or luxury purchases (30 years of interest on a vacation?)
• Your current rate is below 5% (you'd lose a great rate)
• You plan to sell within 2 years (closing costs won't break even)
• Speculative investments (crypto, stocks, etc. with your home)
• Paying off debt you'll run up again (unsecured → secured = risk)

3 Real Cash-Out Refinance Scenarios

Scenario 1: Debt Consolidation — Save $850/month

Before (Current Debts)

Mortgage ($280K @ 7.25%)$1,910/mo

Credit cards ($32K @ 22%)$960/mo

Car loan ($18K @ 8.5%)$450/mo

Total monthly$3,320/mo

After (Cash-Out Refi)

New mortgage ($330K @ 6.35%)$2,054/mo

Credit cards$0 (paid off)

Car loan$0 (paid off)

Total monthly$2,054/mo

Monthly savings: $1,266. Annual savings: $15,192. Cash-out amount: $50K. Closing costs: ~$6,600. Break-even: 5.2 months. Interest saved by eliminating 22% credit card debt: $28,000+ over 5 years.

Scenario 2: Kitchen + Bath Renovation — $45K ROI

Cash-out amount: $60,000
Current home value: $420,000
Renovation cost: $55,000 (kitchen $35K + 2 baths $20K)
New rate: 6.35% (was 6.90%)

Post-reno value: $500,000 (+$80K)
Net equity gain: $80K - $55K = $25,000
Lower rate savings: $120/mo ($43,200 over 30yr)
Total benefit: $68,200

Scenario 3: Investment Property Down Payment

Cash-out: $75,000 from primary home
Use: 25% down on $300K rental property
Rental income: $2,100/month

Rental PITIA: $1,650/month
Net cash flow: $450/month ($5,400/year)
ROI on $75K: 7.2% cash flow + appreciation

Used home equity to acquire a cash-flowing asset. The rental income covers its own mortgage AND the extra $75K added to the primary mortgage. Wealth-building on autopilot.

Best Renovations to Fund with Cash-Out Refi

Renovation	Avg Cost	Value Added	ROI	Worth It?
Garage door replacement	$4,300	$4,100	95%	YES
Minor kitchen remodel	$28,000	$22,000	79%	YES
Siding replacement	$19,000	$14,700	77%	YES
Bathroom remodel	$25,000	$17,500	70%	YES
Deck addition	$18,000	$12,400	69%	Maybe
Major kitchen remodel	$80,000	$48,000	60%	NO (over-improve)
Swimming pool	$65,000	$26,000	40%	NO

ROI data from Remodeling Magazine 2025 Cost vs. Value Report. Focus on cosmetic updates with 70%+ ROI.

Cash-Out Refi vs. HELOC vs. Home Equity Loan

Factor	Cash-Out Refi	HELOC	Home Equity Loan
Rate	6.35% (fixed)	8.50% (variable)	7.75% (fixed)
Closing costs	2-5% ($4K-$12K)	$0-$500	$2K-$5K
Payment structure	One mortgage payment	Second payment + variable	Second fixed payment
Best for	Large amounts ($50K+)	Ongoing access to funds	One-time fixed need
Rate improvement	Yes (replaces old rate)	No (keeps old rate)	No (keeps old rate)
Max LTV	80%	85-90%	80-85%

Quick decision guide: Choose cash-out refi if your current rate is above 6.35% (you lower your rate AND get cash). Choose HELOC if your current rate is below 5.50% (don't lose that great rate). Choose home equity loan if you need a fixed amount with predictable payments.

5 Cash-Out Refinance Mistakes to Avoid

Cashing out more than you need. Every dollar you borrow costs interest for 30 years. If you need $40K, don't take $60K "just in case." That extra $20K costs $14,000+ in interest over the loan term.

Paying off credit cards then running them up again. 68% of people who consolidate credit card debt with a cash-out refi accumulate new credit card debt within 2 years. Cut the cards or freeze them in ice.

Losing a sub-5% rate. If your current mortgage is at 3.50-4.50% (locked in 2020-2021), a cash-out refi at 6.35% dramatically increases your payment. Consider a HELOC instead to keep the low first mortgage rate.

Ignoring closing costs. Cash-out refis typically cost $4,000-$12,000 in closing costs. Factor this into your break-even calculation. If you're only saving $200/month, it takes 2-5 years to recoup costs.

Extending your loan term. Refinancing a mortgage with 22 years remaining into a new 30-year loan adds 8 years of payments. Consider a 20- or 25-year term to stay on track. Or make extra payments.

Cash-Out Refinance Requirements

Credit Score: 620 min (680+ for best rates)

Home Equity: 20%+ (keeping 20% after cash-out)

DTI Ratio: Max 43-50%

Seasoning: Own home 6+ months (12 months for FHA)

Documentation: W-2s, pay stubs, tax returns, bank statements

Appraisal: Required (lender pays for some programs)

Related Resources

Home Equity Calculator →Refinance Savings Calculator →Current Home Equity Rates →HELOC Calculator →How to Negotiate Your Rate →Best Mortgage Lenders 2026 →

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Editorial Note: Rates from Freddie Mac PMMS and lender surveys. Equity data from Cotality (CoreLogic). Updated Feb 13, 2026. Editorial standards.