The Quick Read: Sometimes, but meeting the minimum only makes a file eligible to be considered. It does not approve the loan. Across the wholesale conventional programs Lendmire works with, the starting decision score is 620, and a stronger file at that score can still be declined if equity, debt ratios, or seasoning fall short. Subject to lender guidelines and full file review, the score opens the door and everything else decides whether you walk through it.
Key Takeaways
- “The minimum” is not one number. It changes by program, by underwriting method, and by lender.
- Equity comes first. A conventional cash-out on a one-unit primary residence tops out at 80% LTV.
- A lower score at higher leverage usually costs more, even when the loan is allowed.
- Seasoning matters as much as score: 12 months on the loan being paid off, and 6 months on title.
- If you are declined, the reason code tells you whether to fix the file, wait, or change programs.
What Does “Minimum Credit Score” Actually Mean?
It means the lowest score a program will consider, not the score that gets you approved. Think of it as a floor with a lot of furniture on top of it.
Cash-out refinance estimate
The starting figures are an example value with a balance and a cash request in proportion. Replace them with yours.
Editable benchmark: 7.24% as of October 29, 2026 · Freddie Mac 30-year average via FRED®. A conventional market reference, not a cash-out refinance quote.
Illustrative starting assumptions: a $350,000 home value, a $193,000 current balance, the agency cap on a one-unit principal residence, a thirty-year term at the current Freddie Mac benchmark, and property taxes and insurance estimated at typical national rates. Every field is editable.
Illustrative estimate only — not a Loan Estimate, approval, quote, or commitment to lend. The rate field carries the weekly Freddie Mac thirty-year conventional benchmark, a market reference and not a cash-out refinance quote; a cash-out loan is priced by the lender at lock. The cash available is the loan the program cap allows less the balances paid off, before closing costs, which are not included. The HELOC line is the program’s combined loan-to-value ceiling applied to the same value and balance. Taxes and insurance are editable estimates. Licensed in sixteen states for consumer mortgages.
There are three layers. The agency layer is the rule set from Fannie Mae and Freddie Mac. The lender layer is any extra requirement a bank or wholesale lender adds. The file layer is your own equity, income, debts, and property.
On the agency layer, Freddie Mac’s cash-out refinance page lists a 620 minimum Indicator Score unless the Guide says otherwise. Fannie Mae went a different direction for loans run through its automated system. Trade press covering Fannie Mae’s release notes reports that the fixed 620 floor was removed for Desktop Underwriter casefiles created on or after November 16, 2025. Lenders still pull scores. The system just weighs credit risk alongside everything else instead of applying a hard cutoff.
So why do you still see 620 everywhere? Because lenders and mortgage insurers can keep their own floors. Across the wholesale conventional programs Lendmire places files with, the starting point is a 620 decision score (640 on an adjustable rate under manual underwriting). That is a program fact, and it is also why a borrower at 610 may hear “no” from one source and “maybe” from another.
How Do the Programs Compare on Credit?
Each program handles credit differently, and none of them treats the score as the whole story.
| Program | How credit is treated | What else caps you |
|---|---|---|
| Conventional | 620 decision score starts the wholesale programs | 80% LTV on a one-unit primary residence |
| FHA cash-out | HUD sets a low floor; lenders usually set higher | 80% LTV and CLTV |
| VA cash-out | Lender sets the score; VA sets no number | VA appraisal and Certificate of Eligibility |
| Jumbo | Higher score tier, 660 decision score | Leverage to 90% on the program, 50% ratio ceiling on fixed lanes |
For FHA, HUD Mortgagee Letter 2019-11 cut the maximum LTV and CLTV on cash-out refinances to 80%. That cap applies no matter how high your score is. A common myth is that FHA lets you borrow more. For cash-out, it does not.
For VA, VA.gov’s cash-out page says you qualify if you meet VA’s and your lender’s standards for credit, income, and other requirements. You go through a private lender, and the lender sets the score.
One more point that trips people up: the FHA Streamline and VA IRRRL are not cash-out loans. They refinance an existing government loan, with limited credit review in the FHA case, and neither lets you take cash. The “no credit check” appeal belongs to streamlines only.
Why Is Cash-Out Held to a Higher Bar?
Because you are borrowing against equity you already have, and lenders see that as more risk than a plain rate-and-term refinance. A rate-and-term loan can go to 95% LTV on a one-unit primary residence. A conventional cash-out stops at 80% on that same home. Leverage, reserves, and pricing vary by lender and program; the final terms follow the full file review.
Pricing follows risk. Freddie Mac applies a credit fee based on Indicator Score and LTV to cash-out loans, and Fannie Mae applies loan-level price adjustments to certain cash-out files. A lower score at higher leverage costs more even when it is eligible. The size of that cost belongs in a Loan Estimate, not in an article.
A CFPB research review found cash-out borrowers tend to have lower credit scores and incomes than other refinance borrowers, with similar LTV and DTI. That fits what brokers see: plenty of people use cash-out because other credit is tight. It also explains why lenders look hard at the whole file.
What Do Underwriters Weigh Besides the Score?
Equity, debt-to-income, reserves, seasoning, the appraisal, and your payment history all carry weight. The score gets your file read. These factors decide the outcome.
| Factor | What the lender checks | How it interacts with a low score |
|---|---|---|
| Equity (LTV) | Loan size against appraised value | Less cushion leaves less room for a weak score |
| Debt-to-income | Total monthly debts against income | The automated finding governs most files, with a 50% ceiling |
| Reserves | Savings left after closing | Can offset a borderline file; required in some cases |
| Seasoning | Age of the loan and time on title | Fixed rules; a strong score does not waive them |
| Appraisal | Value and condition | A low value shrinks the cash available |
| Credit history | Late payments, collections, recent events | Recent lates matter more than an old low score |
Two of these deserve a closer look.
Seasoning. If the cash-out pays off your current first mortgage, that loan must be at least 12 months old, measured from the old note date to the new note date. Fannie Mae’s capital markets notice sets that rule. You also need to have been on title for 6 months, with exceptions such as delayed financing, inheritance, and legal awards. People often assume six months of ownership is enough. It is not.
Debt ratios and reserves. Under manual underwriting, total ratios of 36% or 45% apply, with the reserve and score factors of the Eligibility Matrix. Minimum reserves apply on cash-out Desktop Underwriter files when DTI is above 45%. That is one reason a high-ratio, low-score file struggles even when each number alone looks acceptable.
One quick note on occupancy: cash-out can be written on a primary residence, second home, or investment property, but occupancy sets the leverage. On a two- to four-unit primary residence, the cap is 75%, not 80%.
Same Score, Different Outcomes
Three borrowers can share a score and get three different answers. These are illustrative profiles, not real files.
Borrower A: strong equity, steady income. She owns a one-unit primary residence with plenty of room under the 80% LTV cap. Her debts are modest, she has savings left after closing, and her current mortgage is well past 12 months. Her score sits right at the program floor. The file is eligible, and the pricing reflects the score. This is the profile most likely to get a yes. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
Borrower B: thin equity, high debts. He wants to pull cash from a home where the new loan would sit right at the cap. His monthly debts already take a large share of his income, and he has little in reserves. Same score, same program. The automated system is more likely to refer or decline the file, and manual underwriting would hold him to the reserve and ratio factors of the Eligibility Matrix.
Borrower C: good numbers, wrong timing. She bought the home eight months ago and refinanced seven months ago to replace the original loan. Her score and equity are fine. The new first mortgage is not 12 months old, so she is not eligible for a conventional cash-out. Waiting is the fix, not credit repair.
What the three show: the score is one input. Equity, ratios, reserves, and timing can each override it.
What Can Offset a Borderline Score?
A borderline score can be helped by a few things, roughly in this order of impact.
1. Lower leverage. Asking for less cash, or having more equity, widens your margin. Every point under the cap helps.
2. Lower debt-to-income. Paying down a car loan or card before applying can move the ratio more than a small score bump.
3. Reserves. Documented savings after closing show you can absorb a bad month.
4. A clean recent payment history. A single recent late payment on the mortgage being refinanced hurts more than an older collection.
5. A co-borrower with a stronger profile. This helps in some cases but also brings the second borrower’s debts and credit into the file, so it cuts both ways.
Equity is the biggest lever. If you are at the cap and the score is thin, trimming the cash-out amount is often the single most useful change.
Is there a flip point? Yes. If your goal is simply a lower payment or shorter term and you do not need cash, a refinance allows 95% LTV on a one-unit primary residence with only incidental cash back. Fannie Mae’s limit is the lesser of 2% of the new loan or $2,000, and Freddie Mac’s is the greater of 1% or $2,000. That route is more forgiving on leverage, so it is worth asking whether you need the cash at all. Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
What Should You Do If You Are Declined or Borderline?
Ask for the specific reason first, because the fix depends on it. Declines usually come down to score, ratios, equity, or seasoning, and each has a different remedy.
Here is a practical sequence:
1. Get the reason in writing. Ask whether it was the score, the ratios, the appraisal, or a timing rule.
2. Check your credit reports for errors. A wrong collection or balance can drag the score. Dispute it before you reapply.
3. Lower what you can control. Pay down revolving balances, avoid new debt, and ask for less cash.
4. Check the clock. If seasoning was the issue, the answer is a date, not a project.
5. Consider a different program or lender. One lender’s overlay is not another’s. Government programs and the wholesale conventional lanes read credit differently.
6. Consider an alternative. A home equity loan or HELOC leaves your first mortgage in place, which matters if your current loan is something you want to keep. A cash-out refinance replaces the entire first mortgage.
That last point matters more than most people expect. If your existing loan is one you are happy with, cash-out means giving it up to reach the equity. Compare the options before you decide.
Credit events carry their own clocks. The agency waiting periods are four years from a Chapter 7 discharge, seven from a foreclosure, and four from a short sale or deed-in-lieu, shorter with documented extenuating circumstances. A recent event is a timing problem, not a score problem.
What Happens to Your Credit and Budget?
Expect a hard inquiry and a new loan, and plan for a larger balance. A cash-out refinance may lengthen the time to pay off your mortgage and can raise the monthly payment, since the new loan is bigger. Lenders typically want you to keep a meaningful share of your home’s value as equity.
On credit, the CFPB found that borrowers’ scores rose after a cash-out and then gradually slipped, as credit card balances drifted back toward earlier levels. The lesson: using the cash to clear cards only helps if the cards stay clear.
Mortgage insurance is another piece. On the agency path it is required above 80% LTV, and the one exception is the wholesale no-MI cash-out lane described below. A standard conventional cash-out stops at 80%, so MI rarely applies to it. It matters more if you are weighing a rate-and-term refinance at higher leverage. The borrower may request cancellation at 80% of original value, and the servicer must end it at 78% under the Homeowners Protection Act. Every figure here varies by lender and program — guidelines, property type, leverage, and credit profile all apply.
Before You Apply: A Short Checklist
- Pull your credit reports and look for errors. Do this before any lender pulls your score.
- Write down your current loan’s note date and your date on title. Seasoning is a yes or no question.
- Add up monthly debts against gross income so you know your ratio.
- Decide how much cash you actually need. Less cash means lower leverage and more margin.
- Avoid opening new credit or making large purchases until the loan is done. A score that drops between application and closing can change the file.
- Gather income, asset, and payoff documents, plus the payment history of the loan being refinanced. VA borrowers also need a Certificate of Eligibility.
A preapproval is the cleanest way to find out where you actually stand, because it runs the automated findings against your real file. Lendmire’s cash-out refinance programs page lays out the options.
Where the Lendmire Network Sits
Lendmire is a mortgage broker licensed for consumer lending in 16 states, arranging conventional, FHA, VA, and jumbo loans through wholesale lenders. It does not lend directly.
Across the wholesale programs placed there, a conventional cash-out reaches 80% LTV on a one-unit primary residence and 75% on two- to four-unit properties, second homes, and investment property. One wholesale lane reaches 89.99% LTV with no mortgage insurance, at a 680 score and a 50% ratio, on a thirty-year fixed, primary residence, conforming balance, with its own six months of seasoning. In Texas, a cash-out on a homestead is capped at 80% of the home’s value by the state constitution, and that wholesale lane is not written there. Final terms depend on lender guidelines, property type, leverage, and the borrower’s complete credit picture.
All of this is subject to lender guidelines and full file review, and none of it is a commitment to lend.
Key Terms Defined
LTV (loan-to-value): The new loan amount divided by the home’s appraised value.
DTI (debt-to-income): Your total monthly debt payments divided by your gross monthly income.
Seasoning: The minimum age of your current loan, or time on title, before a cash-out is allowed.
Overlay: A lender’s own requirement that is stricter than the agency rule.
Limited cash-out (rate-and-term) refinance: A refinance that pays off the old loan and closing costs with only small cash back.
LLPA: A loan-level price adjustment, an extra pricing charge tied to factors like score and LTV on certain loans.
Frequently Asked Questions
Can I get approved at the minimum score?
Yes, it is possible, but eligibility is not approval. A file at the floor needs enough equity, manageable ratios, and clean seasoning, and it typically costs more than a stronger-score file at the same leverage. Subject to lender guidelines and full file review.
Do all lenders use the same minimum?
No. Fannie Mae removed its fixed 620 floor for automated casefiles, while Freddie Mac lists 620 unless the Guide says otherwise. Lenders and mortgage insurers can add their own, so some set a higher floor than the agency. That is why one lender may say no where another says maybe.
How long do I have to own the home before a cash-out?
You generally need 6 months on title, and if you are paying off a first mortgage, that loan must be at least 12 months old. Delayed financing, inheritance, and legal-award exceptions exist. A recent refinance can reset the 12-month clock.
Is a HELOC easier to get than a cash-out refinance?
It can be, because a HELOC leaves your first mortgage in place and is a separate loan with its own lender standards. The tradeoff is a second payment and a different cost structure. A cash-out replaces your first mortgage entirely, which matters if you have a loan you want to keep.
What if my score drops before closing?
The lender can re-check credit before closing, and a lower score or new debt can change eligibility or pricing. Avoid new accounts and large purchases until the loan is done. If the file no longer fits, ask whether lowering the loan amount restores it.
If you are weighing a cash-out refinance against keeping the loan you have, Lendmire can help you compare the programs and the equity each one reaches. Reach out at 828-256-2183.
For your own numbers, request a scenario review with Lendmire.
About Lendmire
Lendmire — NMLS# 2371349 — is a mortgage broker that arranges FHA, VA, conventional and jumbo home purchase and refinance financing in 16 states through wholesale lenders. Every option is subject to the lender’s guidelines and full underwriting. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 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. Freddie Mac cash-out refinance page
2. Fannie Mae DU credit-score change (trade press)
3. HUD Mortgagee Letter 2019-11
4. VA.gov cash-out refinance page
5. CFPB cash-out refinance research blog
6. CFPB Older Americans Housing Guide
7. CFPB: CFPB Report Finds Cash Out Mortgage Refinance Borrowers Improve Credit Scores
This article is part of Lendmire’s cash-out refinance program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Cash-Out Refinance Lenders for Rural Homeowners · Best Cash-Out Refinance Program Before Seasoning Is Met · Cash-Out Refinance Lenders for Any Purpose With No Restrictions on Use
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Compliance and disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage broker and is not a direct lender, depository institution, financial advisor, or tax professional. Content in this article is general market analysis and educational information — not financial, legal, or tax advice for any specific situation. Lendmire does not guarantee loan approval; every transaction is subject to underwriting by the funding lender. Mortgage pricing and loan program guidelines are subject to change at any time without notice and vary by borrower characteristics, property type, and state regulations. Lendmire complies with Equal Housing Opportunity. Licensure verification: NMLS Consumer Access.