The Quick Read: Banks, credit unions, mortgage companies and brokers can all offer this loan, because the rules come from the agencies behind the loan, not from any one lender. On a one-unit home you live in, conventional cash-out has a loan-to-value (LTV, the new loan as a percent of the home’s value) ceiling set by the program, and DSCR cash-out programs cap LTV lower, at 75%. Which lender fits you depends on your equity, credit, existing loan type and what you need the cash for. Everything here is subject to lender guidelines and full file review, and nothing is a commitment to lend.
Why a List of Banks Won’t Help You
Most people searching this want a name. Here is the straight answer: the name matters less than the program.
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: 7.18% as of November 5, 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.
Fannie Mae, Freddie Mac, HUD (which runs FHA) and the VA write the underwriting rules. Any approved lender can then offer the loan. The VA says this directly: you get a VA cash-out loan through a private bank, mortgage company or credit union, not through the VA itself, per the VA’s cash-out loan page.
So two lenders offering the same program will ask for the same core things. They differ in extra rules (lenders call these overlays), in pricing and in which programs they carry. That last difference is where a broker earns its keep. Lendmire is a mortgage broker, not a lender. It arranges loans through a network of wholesale lenders and matches the scenario to the program. Lendmire’s cash-out refinance programs page lays out the options.
This article does not rank or name lenders. The best program for your situation depends on your home, your credit and your goal.
What a Cash-Out Refinance Actually Is
A cash-out refinance replaces your current first mortgage with a bigger one. You pocket the difference in cash. The new loan pays off the old one, covers closing costs, and the leftover comes to you.
It is different from a refinance, which changes your interest rate or loan length without taking meaningful cash out. Agencies call a rate-and-term refinance a “limited cash-out” refinance because a small amount of cash back is allowed. That incidental cash is capped, and each agency sets its own cap. Fannie Mae uses the lesser of 2% of the new loan amount or $2,000. Freddie Mac uses the greater of 1% of the new loan amount or $2,000. Go past the cap and the loan becomes a cash-out refinance, with its own rules.
It is also different from a home equity loan or HELOC (home equity line of credit). Those sit on top of your first mortgage as a second payment. A cash-out refinance is one replacement loan, one payment.
Why “Single-Unit, You Live In It” Changes the Math
Occupancy and unit count set your leverage. That is the whole reason this phrase in the title matters.
On a one-unit home that is your principal residence, conventional cash-out gets the strongest leverage of any occupancy type. Two- to four-unit homes, second homes and rentals sit lower, with a cash-out ceiling of 75% LTV. You can confirm the one-unit ceiling on the Fannie Mae Eligibility Matrix. A cash-out can be written on other occupancy types too, but a one-unit primary home gets the most room.
Lenders also treat the loan as lower risk when you live there. Expect them to ask for proof of occupancy, such as the address on your ID, bills and tax records.
One more wrinkle: some states add their own homestead equity rules. In Texas, the state constitution caps a cash-out on a homestead (a Section 50(a)(6) loan) at 80% of the home’s value, so the higher leverage of the no-mortgage-insurance wholesale lane described below is not available there. That lane is not written in Texas.
How the Loan Is Underwritten, Step by Step
Underwriting is the lender’s review of whether you and the home fit the program. It runs in a predictable order.
1. Pick the loan type for your goal. Cash for any purpose means cash-out. A lower payment or shorter term means rate-and-term. An existing FHA or VA loan with no need for cash points to a streamline.
2. Confirm occupancy. The home must be your principal residence for standard FHA and VA cash-out loans.
3. Check the clocks. More on these below.
4. Order the appraisal. The value sets how much you can borrow. FHA applies its cap to an “Adjusted Value,” not always the raw appraisal. Fannie Mae sometimes accepts the lender’s submitted value in place of an appraisal. The lender decides that, and you should never count on it.
5. Review credit, income, assets and debt. The automated underwriting system issues a finding. Across the conventional programs I work with, scores start at a 620 decision score. The total debt ratio ceiling is 50% on most automated files. Manually underwritten loans use 36% or 45%, with reserve and score factors from the matrix.
6. Pay off the liens. The new loan replaces your first mortgage. Existing second liens count toward your LTV, so they shrink the cash available.
7. Sign and wait out the cancellation window. On a primary residence you get three business days to cancel a refinance before funds are released, per the CFPB. If required disclosures were wrong or missing, that right can stretch up to three years.
The Clocks: Seasoning and Time on Title
Seasoning is the waiting period before you can refinance. Two clocks matter on a conventional cash-out.
First, the mortgage being paid off must be at least 12 months old, counted note date to note date. That comes from Fannie Mae’s SEL-2023-01 announcement, and Freddie Mac’s Guide §4301.5 has a matching rule with listed exceptions.
Second, at least one borrower must have been on title for six months. Exceptions exist for delayed financing, inheritance and legal awards.
Recent buyers get caught here. You can have plenty of equity and still be too new. A wholesale lane I place, covered below, has its own six-month seasoning.
Structures and Variations
The standard conventional cash-out is only one path. Here is how the main structures compare.
| Structure | Who it fits | Cash back? |
|---|---|---|
| Conventional cash-out | Most owners with equity | Yes, up to the program’s LTV limit |
| No-MI wholesale lane | Strong credit, conforming balance | Yes, up to the program’s LTV limit |
| FHA cash-out | Owners on FHA, moderate credit | Yes, up to the program’s LTV limit |
| VA cash-out | Eligible veterans and service members | Yes, with a COE |
| FHA Streamline / VA IRRRL | Existing FHA or VA loan | No meaningful cash |
The lane
The wholesale no-MI cash-out lane reaches 89.99% LTV with no mortgage insurance at a 680 score and a 50% ratio. It must be a thirty-year fixed on a primary residence with a conforming balance, and it carries its own six months of seasoning. This is a wholesale program. A lender working from a single shelf may not carry it, which is one reason a broker’s network matters.
Mortgage insurance is required above 80% LTV on the agency path, with the wholesale no-MI cash-out lane as the one exception. When mortgage insurance does apply, it cancels on request at 80% of the original value (with good payment history, no subordinate liens and no drop in value). Servicers must end it automatically at 78%. Lendmire’s conventional program sheet lists typical annual premiums of 0.58% to 1.86% of the balance, and that range is a program-sheet figure, not a quote.
FHA cash-out
FHA cash-out is for owner-occupied principal residences, and a free-and-clear home counts. HUD cut the maximum LTV for cash-out refinances from 85% to 80%, so “FHA still allows 85%” is outdated.
VA cash-out
A VA cash-out needs a Certificate of Eligibility, and you must live in the home. The lender orders the appraisal. Terms and fees vary by lender, and the VA itself suggests contacting several.
Streamlines are not cash-out loans
The FHA Streamline and VA IRRRL lower the cost of an existing government loan. Neither lets you take meaningful cash. The IRRRL requires a VA-to-VA refinance and carries a 0.5% funding fee unless exempt, with seasoning of the later of 210 days and six payments. The FHA Streamline needs a net tangible benefit and offers minor adjustments only. If you want cash out of a non-VA loan into a VA loan, you need the VA cash-out instead.
Jumbo
Above the conforming limit, jumbo lanes take over. Across those lanes, the decision score starts at 660, leverage reaches 90% on some, loans run to $5,000,000, and the ratio ceiling is 50% on the fixed lanes. Jumbo programs are narrower, so scenario fit matters even more.
Where the General Rule Breaks
- Free-and-clear homes. A new loan on a home with no mortgage is still a cash-out refinance at Freddie Mac and under FHA rules.
- Paying off a second lien. Under Fannie Mae’s B2-1.3-02 rule, a second lien paid off in a refinance keeps limited cash-out status only if it was used to buy the home. Otherwise the loan becomes a cash-out refinance.
- Buying out a co-owner. With a written agreement, this counts as limited cash-out at both agencies.
- Student loan payoff. Fannie Mae waives the extra pricing adjustment on cash-out when proceeds pay off student loans and the requirements are met.
- PACE liens. A property-assessed clean energy lien in priority position can make a home ineligible for sale to Freddie Mac. Some cash-out proceeds must pay it off.
- Manufactured homes. Single-width units face tighter limits. Check the Eligibility Matrix.
- Credit events. Agency waiting periods apply: four years from a chapter 7 discharge, seven from a foreclosure, and four from a short sale or deed-in-lieu. Documented extenuating circumstances can shorten them.
Cash-out can also price differently from rate-and-term. Fannie Mae applies loan-level price adjustments to certain cash-outs, and Freddie Mac charges credit fees on cash-out. Those costs are built into the pricing you see on your Loan Estimate.
The Decision in Practice
Picture a homeowner with a one-unit primary residence, a first mortgage three years old and a kitchen to redo. Equity sits well under the 80% cap. That owner is a standard conventional cash-out candidate. The question is whether replacing the whole first mortgage makes sense, versus a second loan on top.
Now picture an owner with a very low existing loan and strong credit who wants a large sum. The 89.99% lane may reach more equity without mortgage insurance, if the file fits.
Then there’s the owner who bought eight months ago and has the equity. The 12-month clock and the six-month title clock decide whether this is even possible.
A cash-out refinance fits best when:
- Your current loan terms are worth giving up for the cash you need.
- You will use the money for something that lasts, like repairs.
- You can handle a larger balance on a home that secures it.
It fits worse when you want the cash for something that won’t last. A CFPB report found that cash-out borrowers often pay down credit card and auto debt. Your home secures the debt, so if you can’t repay, the lender can foreclose.
Which Lender Type Fits You
| Lender type | Often suits | Ask about |
|---|---|---|
| Bank or credit union | Existing customers | Overlays, program menu |
| Online lender | Straightforward files | Who services the loan |
| Mortgage broker | Mixed or tricky files | Which lenders it shops |
Whichever door you use, ask each one these questions:
- Which programs do you offer for a one-unit primary residence?
- Do you add rules beyond the agency minimums?
- How will mortgage insurance work on my loan?
- What will my Loan Estimate show for each option?
Compare full Loan Estimates, not only the monthly payment. The CFPB points out that upfront costs apply and that cash-out may cost more or less than a HELOC depending on terms.
What to Gather Before You Apply
Pull together pay stubs or income records, bank and asset statements, your current mortgage statement, homeowners insurance details and ID with your home address. If you have a second lien or a PACE assessment, bring those documents too. Lenders ask for proof you live in the home, so keep utility bills handy.
Key Terms Defined
Cash-out refinance: A new, larger first mortgage that pays off the old one and gives you the difference in cash.
Limited cash-out refinance: The agency name for a rate-and-term refinance, where only a small, capped amount of cash back is allowed.
Loan-to-value (LTV): The loan balance as a percentage of your home’s value, counting all liens.
Seasoning: The waiting period a loan or ownership must age before you can refinance.
Loan-level price adjustment (LLPA): A fee Fannie Mae builds into pricing for certain loans, including some cash-outs, based on LTV and credit score.
Overlay: An extra rule a lender adds on top of agency guidelines.
Frequently Asked Questions
Which banks offer a cash-out refinance on a home I live in?
Many banks, credit unions, mortgage companies and brokers do, since the agencies set the core rules. What differs is the program menu and any overlays. Compare programs and full Loan Estimates rather than hunting for one name.
How much equity can I take out of a one-unit primary home?
On a conventional cash-out, the ceiling is 80% LTV, counting every lien on the home. A wholesale no-MI lane reaches 89.99% with a 680 score and a 50% ratio. Equity always stays in the home, and eligibility is subject to lender guidelines.
Can I do a cash-out refinance soon after buying?
Usually not. The mortgage being paid off must be at least 12 months old, and a borrower must be on title for six months. Delayed financing, inheritance and legal awards are exceptions. A wholesale lane has its own six-month seasoning.
Can an FHA Streamline or VA IRRRL give me cash?
No. Both are built to improve an existing government loan, and neither allows meaningful cash back. To take cash out, you need an FHA cash-out or VA cash-out refinance, subject to program rules.
Can I cancel after I sign?
On a refinance of your primary home, you have three business days after the transaction to cancel. The clock starts only after the required events happen. Cancelling does not erase your original loan.
If You’re Ready to Compare
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.
For your own numbers, request a scenario review with Lendmire.
About Lendmire
As a mortgage broker (NMLS# 2371349), Lendmire helps homeowners and home buyers in 16 states with FHA, VA, conventional and jumbo purchase and refinance loans arranged through wholesale lenders. Lendmire is never the lender; program terms are set by the lender and the agency guidelines. 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
2. Fannie Mae Eligibility Matrix
4. Fannie Mae SEL-2023-01 announcement
6. Fannie Mae’s B2-1.3-02 rule
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: How to Plan and Use a Cash-Out Refinance to Access Cash From Home Equity · Cash-Out Refinance vs Selling a Second Home for an Owner Needing Cash · How to Qualify and Apply for a Cash-Out Refinance on Your Home
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
Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.