The Ultimate Guide to Cash-Out Refinancing in 2025 |Mortgage & Investment Loans
What is a Cash-Out Refinance?
A cash-out refinance replaces your existing mortgage with a new, larger loan—allowing you to withdraw the difference as cash. The amount you can borrow depends on your home’s equity, loan-to-value ratio (LTV), and credit score.
✔ Use home equity to fund renovations, debt consolidation, or investments.
✔ Available for primary residences, second homes, and investment properties.
✔ Lower interest rates than personal loans or HELOCs.
How Much Can You Borrow?
Most lenders allow you to cash out up to 85% of your home’s value (LTV), though investment property refinances may have lower limits.
⏳ Pro Tip: The more equity you have, the more cash you can take out—without significantly increasing your mortgage payment.
Cash-Out Refinance Loan Options
1. Cash-Out Refinance for Primary Residences
✔ Borrow up to 85% of your home’s value.
✔ Best for home improvements, debt consolidation, or major expenses.
2. Investment Property Cash-Out Refinance
✔ Max LTV: 75-80% for rental properties.
✔ Qualify using rental income instead of personal income.
✔ Loan Programs: DSCR Loan
3. Self-Employed Borrowers – No Tax Returns Needed
✔ Bank Statement Loans & 1099 Loans allow cash-out refinancing without W-2s.
✔ Qualify based on business or independent contractor income.
✔ Loan Programs: Bank Statement Loan, 1099 Loan, P&L Loan
4. Hard Money Cash-Out Refinance – Fast Funding for Investors
✔ Quick approvals & funding in as little as 10 days.
✔ No income verification required—loans based on property value.
✔ Loan Programs: Asset based, Alternative Doc, Full Doc
⏳ Investor Tip: A DSCR cash-out refinance allows investors to leverage rental properties without proving personal income.
Frequently Asked Questions (FAQ)
What credit score do I need for a cash-out refinance?
Most lenders require 620+ for primary residences and 660+ for investment properties.
Can I do a cash-out refinance on an investment property?
Yes! DSCR Loans allow cash-out refinancing on investment properties.
What’s the max loan-to-value (LTV) for a cash-out refinance?
✔ Primary Residence: Up to 85% LTV.
✔ Investment Property: Typically 75-80% LTV.
Are there prepayment penalties for cash-out refinances?
Some Non-QM loans may have prepayment penalties, but Full Doc loans usually do not.
How quickly can I close on a cash-out refinance?
✔ Full Doc Loans: 3-4 weeks.
✔ DSCR Loans & Bank Statement Loans: 3-5 weeks.
✔ Hard Money Loans: As fast as 10 days.
