Cash-Out Refinance Calculator
Replace your mortgage with a larger one and take the difference in cash. See the new payment, the cost, and how it compares with keeping your current mortgage and borrowing against your equity instead.
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EstimateThis calculator provides estimates for educational and informational purposes only. It does not constitute financial, investment, legal, accounting, or tax advice. Results are based on the assumptions and information entered and may differ materially from actual outcomes. Tax rules and financial regulations can change. Consult an appropriately qualified professional for advice specific to your situation.
This calculator provides estimates and is not a loan offer.
- Calculates the new loan, closing costs and monthly payment, and the change from today's payment.
- Finds the most cash you could take out at your lender's maximum loan-to-value (usually 80%).
- Compares cash-out refinancing with keeping your low-rate mortgage and taking a home equity loan.
- Shows the blended rate of the keep-and-borrow route.
How to use this calculator
Enter your home value, current mortgage balance, rate and years remaining, the cash you want, and the new rate and term. Open Advanced to set the maximum LTV, closing costs, and the home equity loan terms used in the comparison.
How it works
New loan = current balance + cash out + closing costs (if financed) Loan-to-value = new loan / home value Most cash = home value x max LTV / (1 + closing cost %) - current balance
Closing costs are added to the new loan. The calculator compares total monthly cost and ten-year cost for the refinance against keeping the existing mortgage and adding a separate home equity loan for the same cash.
A worked example
A $450,000 home with a $220,000 mortgage at 4%. Taking $60,000 cash with a new 30-year loan at 6.5% produces a $288,400 loan including $8,400 of closing costs. The new payment is about $1,823, up from $1,135. The most cash available at 80% LTV is about $129,515.
Keeping the 4% mortgage and borrowing $60,000 separately at 8.25% gives a blended rate of about 4.92%, which is why this route often wins when your current rate is low.
When it makes sense
Cash-out refinancing works best when the new rate is close to or lower than your current rate, or when you need a large sum. When your existing rate is far below today's rates, refinancing the whole balance can cost far more than borrowing only the cash you need. Look at the whole loan, not just the new money.
Risks to weigh
- The loan term restarts, so you may pay interest for longer.
- Closing costs apply to the full loan, not only the cash.
- Your home secures the larger loan.
- Rates on cash-out refinances are often slightly higher than on regular refinances.
Assumptions and limitations
- Closing costs are a percentage of the new loan, financed into it.
- Rates and terms are fixed.
- Ten-year cost comparison. Results over other horizons will differ.
- Tax effects are not modelled.
Common mistakes
Ignoring the lost low rate. Giving up a 4% mortgage to borrow at 6.5% costs more than the cash alone.
Forgetting the term reset. A new 30-year loan on a 26-year balance extends the payoff.
Using it for spending that does not last. Paying off a loan on a vacation or consumption with a 30-year mortgage is expensive.
Frequently asked questions
Usually up to 80% of your home's value, minus your current mortgage and closing costs. FHA and VA cash-out loans may allow different limits.
It depends on your current rate. If your existing mortgage rate is much lower than today's rates, keeping it and taking a separate loan is often cheaper.
Typically 2% to 5% of the new loan, since they apply to the whole loan, not only the cash.
Usually yes. You can choose a shorter term, but the payment will be higher.
Generally no. It is borrowed money, not income. Interest deductibility depends on how the money is used.
Conventional cash-out loans usually require a score of 620 or higher, with better pricing at higher scores.