The Quick Read: Only when “extra” means avoidable add-ons, because no loan structure erases the government charge to record the new lien: the county fee can come out of your proceeds, you can skip unneeded documents, and in a few mortgage-tax states a new-money structure can shrink the taxed amount. Recording never reaches zero. A cash-out can still close with no separate check from you.
- Recording is a government charge, so a lender or broker cannot discount it.
- The fee can be deducted from your cash-out proceeds at the settlement table.
- A second deed recording is the most common avoidable add-on.
- Only some states tax the loan amount itself, and those states are where structure matters most.
- Cash-out on a standard rental tops out around 75% LTV across most of our network, and the recording bill sits inside that math.
What Do You Actually Pay to Record a Cash-Out?
You pay two kinds of charge, and they behave differently. The first is a flat recording fee. The second is a percentage-based tax on the loan amount, which exists only in some states.
DSCR Cash-Out Calculator
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A refinance creates a new lien. A lien is the lender’s legal claim on the property. That claim has to be entered in the county’s public records, and the county charges to do it.
| Charge | Who sets it | Based on | Can you reduce it? |
|---|---|---|---|
| Flat recording fee | County or state | Pages and documents | Only by recording fewer documents |
| Mortgage tax | State or county | Loan amount | Sometimes, through structure |
| Transfer tax | State or local | Deed transfers | Usually not triggered on a refinance |
The flat fee is typically modest next to origination, title, and appraisal costs. It varies by county and by page count. A mortgage tax is a different animal because it scales with the size of the loan.
A refinance records a mortgage or deed of trust. It usually does not record a new deed. That is why transfer tax, which attaches to deeds, normally stays out of a cash-out on a property you already own.
Three Ways to Keep Recording Costs Down
You have three real levers, and none of them gets the fee to zero.
Pay it from proceeds. The settlement agent deducts the county charge from your cash-out. You bring no separate check. Your net cash is a little lower, but nothing comes out of your pocket at the table.
Avoid extra documents. Each recorded document adds cost. If a refinance also requires a new deed, you pay to record both. Ask early whether your file needs only the mortgage.
Use a state-specific structure. Where a state taxes mortgage recording, some structures cut the taxed base. New York’s consolidation approach is the main example, and a later section covers it.
One caution on the phrase no-closing-cost refinance. It usually means someone else absorbs the cost through pricing or the balance, and the government still collects its fee.
Why Do Recording Costs Change by State?
Recording costs change by state because only some states tax the loan amount when a mortgage is recorded. Most states charge only flat fees. A few tax the full new loan. A few tax only the new money.
| Bucket | What gets taxed | Cash-out effect |
|---|---|---|
| Flat fees only | Nothing tied to loan size | Loan size barely matters |
| Tax on full new loan | Entire new mortgage | Bigger cash-out, bigger tax |
| Tax on new money only | Gap over old balance | Structure can help |
Florida shows how a full-loan tax works. The Florida Department of Revenue states that documentary stamp tax on mortgages is 35 cents per $100 of the amount secured. It applies when the mortgage is recorded in Florida. The state sets no cap on that tax for recorded mortgages.
A second Florida charge stacks on top. According to the law firm Starfield & Smith, the nonrecurring intangible tax is 2 mills, or 0.002, per dollar of the secured amount. Together the two taxes come to roughly 0.55% of the amount secured, before any flat fees.
Notice what that means for a cash-out. The base is the whole new loan, not just the cash you pull out. Even the portion that only pays off your old lender gets taxed again.
New York works on the same principle with different mechanics. Per Kalantarov Law, the tax depends on the mortgage amount and the county.
Can a Lender or Broker Waive Recording Fees?
No. Recording charges belong to the government, not the lender. The CFPB’s integrated disclosure guide places recording fees in a category of taxes and fees assessed by a government authority. It keeps them separate from transfer taxes. That split matches what you see on a settlement statement, with deed and mortgage recording on separate lines.
DSCR loans are designed for non-owner-occupied investment properties. Because they are business-purpose investor loans, they are reviewed differently from a standard owner-occupied mortgage. Consumer mortgage disclosure forms, including the three-business-day waiting rule, do not apply to them. Your settlement statement will look different, but it will still itemize the county’s recording charges.
A recording line that looks padded is the exception. County fee schedules are public, so you can compare the line against the county’s published numbers.
How Does a New York CEMA Cut the Taxed Amount?
A CEMA, short for consolidation, extension and modification agreement, lets you pay mortgage tax only on the difference between the new loan and the existing balance. Brick Underground describes it this way.
The catch is cooperation. The existing lender must assign your old mortgage, and that is not guaranteed on every payoff. Availability depends on the property, the existing lender, and the new lender’s willingness to accept the structure.
Treat a CEMA as a state-law tool, not a program feature. Whether a particular lender in our network accepts one is a file-by-file question.
Some states also carve out renewals or extensions of an existing note. A payoff-and-replace refinance with a new lender usually does not look like a renewal. Ask the title agent before you assume an exemption applies.
How Does Cash-Out Size Change the Bill?
In a full-loan tax state, a bigger loan means a bigger tax. The tax is a percentage, so a loan 10% larger carries about 10% more tax. Costs rolled into the balance get taxed too, because they raise the loan amount.
Consider a scenario with two investors who own similar rentals in a full-loan tax state. One borrows to the 75% LTV ceiling on a cash-out of an investment property. LTV, or loan-to-value, is the loan divided by the property’s value. The other borrows well below that ceiling. Both pay the same flat fee. The first pays noticeably more mortgage tax, because the taxed base is larger. Final terms depend on lender guidelines, property type, leverage, and the borrower’s complete credit picture.
That does not make the smaller loan the better choice by default. You pull out less cash, so the tax per dollar of cash received can still be similar or worse. The real question is whether the cash does enough work to justify the cost.
Three program points frame the decision:
- Cash-out on a standard rental tops out around 75% LTV across most of our network, and the loan includes any costs you roll in.
- Most programs expect about 6 months of ownership before a cash-out, measured from title recording.
- Reserves commonly run about 6 months of PITIA on a cash-out, stepping up for loans above $1,500,000. PITIA is principal, interest, taxes, insurance, and any association dues.
These are typical ranges from select lenders in the network, not guarantees. Credit, property type, and the individual lender all move them.
Closing costs do not enter the DSCR ratio itself. They change your cash to close and, if rolled in, your loan amount and LTV. In practice, recording charges reduce your net proceeds.
Does DSCR Underwriting Change Any of This?
No. The county charges the same recording fee whether the loan is a DSCR loan or any other kind. What changes is how the file qualifies.
A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. The ratio compares rent to PITIA. Clearing 1.00, which is where many select programs start, does not mean the property produces positive cash flow, because repairs, vacancy, and management sit outside the calculation. Coverage below 1.00 is available through select lenders in the network, with leverage and terms adjusted. Our complete DSCR loans guide walks through how the ratio works.
Lender and closing-attorney acceptance still matters. A structure that works in the statute may need the new lender’s sign-off.
DSCR vs. conventional financing
There are two common ways to finance an investment property, and they qualify you differently — here’s how investors weigh them.
Why investors choose it
- Qualifies on the property’s rental income — no personal tax returns, W-2s, or pay stubs needed to document income.
- No personal debt-to-income ceiling to clear, so existing mortgages and obligations don’t cap your borrowing the same way.
- Can be closed in an LLC, keeping the property inside a business entity.
- Built for scaling — not held to the limit on number of financed properties that conventional financing applies.
- Underwriting centers on the deal: generally qualifies when the rent covers the payment, a 1.00x coverage ratio being a common baseline (confirmed in underwriting).
- Designed specifically for investment property, including long-term and, where the program allows, short-term rentals.
Where it’s strong
- Often the lowest ongoing financing cost for a buyer who fully qualifies on personal income — a fit for a first property or a cost-first purchase.
Trade-offs for investors
- Requires full personal income documentation and must fit within a debt-to-income limit — salary, existing debts, and other mortgages all count.
- Typically held in your personal name rather than a business entity.
- Caps how many financed properties you can carry, which can become a ceiling as a portfolio grows.
- Evaluates you as a borrower as much as the property, which usually means more paperwork.
How investors usually choose: a first or single property often optimizes for the lowest financing cost; portfolio builders often optimize for leverage, vesting in an LLC, and scaling past conventional caps. The right answer depends on your goals, the property, and current guidelines — both paths run through select lenders in Lendmire’s wholesale network, with eligibility and terms confirmed in underwriting.
What Should You Ask Before You Sign?
Ask your lender, title agent, or closing attorney these questions before you commit to a cash-out:
1. Does this refinance record only a mortgage, or also a new deed?
2. Does my state tax the full new loan, only the new money, or neither?
3. Is a new-money structure available on my payoff, and will the new lender accept it?
4. Will the recording charges come out of my proceeds, and what is my net cash after them?
5. Are any costs rolled into the loan, and how does that change my LTV?
The vesting question deserves extra attention. Vesting means how title is held. If a refinance moves title from you personally into an LLC, a deed gets recorded in addition to the mortgage. That adds recording cost and, in some places, a transfer tax. Holding title in an LLC is possible on many files, subject to program terms. Confirm whether the move requires a new deed before you commit.
For a larger loan, the conditions stack up differently. Lendmire’s article How to Close a Large Cash-Out Refinance Without Conditions covers that angle.
Key Terms Defined
Documentary stamp tax: a Florida tax on recorded mortgages, charged as a percentage of the amount secured.
Nonrecurring intangible tax: a separate Florida tax on mortgages secured by Florida real property, also based on the amount secured.
CEMA: a New York agreement that merges old and new loans so mortgage tax applies only to the new money.
Vesting: the way title to the property is held, such as in your name or in an LLC.
Net proceeds: the cash you receive after the old loan is paid off and closing costs are deducted.
New money: the portion of a new loan that exceeds the balance of the old one.
Frequently Asked Questions
Does every cash-out refinance trigger a mortgage tax?
No. Only some states tax mortgage recording by loan amount. In many states you pay flat recording fees and nothing tied to loan size. Check with a title agent in the state where the property sits.
Is there transfer tax on a refinance?
Usually not. Transfer tax attaches to deeds, and a standard refinance records a mortgage, not a deed. The exception is a vesting change, where title moves into an LLC and a deed gets recorded. Some places charge transfer tax on that deed.
Can I roll recording costs into the loan?
Often yes, within the 75% LTV ceiling for a cash-out on a standard rental. Rolling costs in raises the loan amount, which lowers your net proceeds and, in a full-loan tax state, raises the tax. Lender guidelines decide what can be financed on a given file.
Does an LLC change the recording bill?
It can. If the refinance requires moving title into the LLC, you pay to record a deed on top of the mortgage. If title is already in the LLC, the recording picture looks the same as for an individual. Eligibility for LLC borrowers is subject to lender program terms.
Are recording costs tax deductible?
That depends on your situation. Tax treatment can depend on how the funds are used and how the property is held; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
Next Step
If you are buying or refinancing a rental property and want to see how the numbers work, Lendmire can help you compare DSCR loan options based on the property income, credit profile, leverage, and investor goals. As a broker arranging financing through select lenders in its wholesale network across 41 markets, including Washington, D.C., Lendmire can also help you line up the title questions above before a file goes to a lender. Call 828-256-2183 or request a quote.
For the mechanics of pulling equity out of a rental property, see Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
Lendmire — NMLS# 2371349 — is a DSCR and non-QM mortgage brokerage with investor loan programs in 41 markets, including Washington, D.C. DSCR eligibility is commonly reviewed by the lender around property-level rent rather than personal income documentation, subject to lender guidelines, and the brokerage helps arrange financing for LLC-owned portfolios beyond conventional financed-property limits. Recognized by Scotsman Guide as a Top Mortgage Workplace in 2025 and 2026.
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. Florida Department of Revenue, Documentary Stamp Tax
2. Starfield & Smith, Florida documentary stamp and intangible tax refresher
3. Kalantarov Law, Understanding Mortgage Recording Tax
4. CFPB TILA-RESPA Integrated Disclosure Guide
5. Brick Underground, What’s a CEMA
This article is part of Lendmire’s investment property cash-out refinance program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can an LLC Rental With a Balloon Loan Get a Cash-Out Refinance? · Can You Do a DSCR Cash-Out Refinance on a Multifamily Building? · Can a Co-Living or SRO Property Get a DSCR Cash-Out?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.