The Quick Read: It depends on what you owe, because the cash is the maximum loan minus everything that loan has to pay off. On a one-unit primary home, conventional programs generally cap the new loan at 80% of the appraised value. Your payoff, any other liens and the closing costs come out of that 80% first. What is left is your cash, and it is always smaller than 80% of the home’s value.
The Formula in One Line
Cash = (maximum LTV × appraised value) − current loan payoff − other liens paid off − costs and fees taken from proceeds.
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.
LTV means loan-to-value: the new loan divided by the home’s appraised value. Maximum LTV is the ceiling a program sets on that ratio. The ceiling limits the loan. It does not promise a cash amount.
The first mistake is borrowing against equity instead of value. At the 80% cap, the 80% applies to the whole new loan, measured against the appraisal. It is not 80% of your equity. A home with a small mortgage leaves a lot of room under the cap. A home with a large mortgage leaves very little.
What Is the Maximum LTV on a Primary Home?
For a one-unit primary residence, conventional cash-out refinances run to 80% LTV. For two- to four-unit primary residences, second homes and investment property, the conventional cap is 75%. Occupancy and unit count set the leverage. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
| Property | Conventional cash-out cap |
|---|---|
| One-unit primary home | 80% |
| Two- to four-unit primary home | 75% |
| Second home | 75% |
| Investment property | 75% |
Those caps are subject to lender guidelines and a full review of your file. Texas has its own rule: a cash-out on a homestead is capped at 80% of the home’s value by the state constitution.
FHA and VA set their own cash-out limits. FHA’s cap sits at or below the conventional one. VA allows a loan up to the full appraised value as VA determines it. That is a ceiling on the loan, not on your cash, because fees and payoffs still come out first.
Lendmire’s cash-out refinance programs page lays out where each program lands, so you can compare the equity each one reaches.
Key Terms Defined
Appraised value: the value an appraiser assigns to your home. Lenders measure LTV against it.
Maximum LTV: the highest loan-to-value ratio a program allows for your property type and purpose.
Equity: the home’s value minus what you owe. It is not the same as cash you can take out.
Payoff: the balance needed to retire your current first mortgage, plus any other liens that must be paid at closing.
Net cash: the money that actually reaches you after the new loan pays everything else.
Seasoning: the waiting period a program requires before you can refinance or cash out.
A Worked Example, No Dollar Signs
Put the home at 100 and read every line as a percentage of its appraised value. The inputs below are modeled assumptions, not typical figures for any market or borrower.
| Line | % of value |
|---|---|
| Appraised value | 100 |
| Maximum new loan (80% cap) | 80 |
| Current first mortgage payoff (assumed) | −55 |
| Other liens paid off (assumed) | −5 |
| Closing costs and fees (assumed) | −3 |
| Net cash | 17 |
The cap said 80. The cash is 17. The gap is everything the loan had to pay before it could pay you.
Does it matter whether you roll the costs into the loan or pay them separately? The table assumes they come out of the loan, which leaves 17 in your pocket. If you pay them separately, the 80 loan would leave 20 after the two payoffs, and you would write a check for the 3 at closing, which nets the same 17. Costs financed into the loan still have to fit under the cap. Fannie Mae’s guide lists financing closing costs, points and prepaid items among the acceptable uses of cash-out proceeds.
What Happens to Your Cash If the Appraisal Comes In Low?
A lower appraisal cuts the cash faster than most borrowers expect. Your payoff does not shrink when the value does. So every drop in value comes straight out of your cash.
Hold the same payoff, liens and costs from the example, and change only the appraisal:
| Appraisal vs. expected | Max loan (80%) | Net cash |
|---|---|---|
| 5% higher (105) | 84 | 21 |
| As expected (100) | 80 | 17 |
| 5% lower (95) | 76 | 13 |
| 10% lower (90) | 72 | 9 |
Each 5% miss on value costs about four points of the original value in cash. Freddie Mac measures refinance LTV against the appraised value as of the appraisal report’s effective date, so the number on that report decides the ceiling. FHA applies its limit to an “Adjusted Value,” so the raw appraisal is not always the number used.
Do Other Liens Count Against the Cap?
Yes. The 80% limit covers the whole new loan plus any subordinate financing. A second mortgage or HELOC that stays in place counts toward the cap, and so does one you pay off. Freddie Mac’s table states the cap as an LTV, TLTV and HTLTV figure, which means it reaches the full stack of debt. A HELOC left open eats room under the cap even if you never touch it.
Can You Take 100% of Your Equity?
No, not on a conventional primary-home cash-out. At the 80% cap, at least 20% of the home’s value stays as your equity. That cushion exists for the lender, and it also protects you if values soften.
One lane reaches further. Among the wholesale programs Lendmire places files with, one goes to 89.99% LTV with no mortgage insurance. It needs a 680 score, a 50% total ratio, a thirty-year fixed term, a primary residence and a conforming loan balance. It carries its own six months of seasoning. In the model above, that would lift the cash available by a meaningful margin, subject to lender guidelines and full file review. It is not written in Texas.
Mortgage insurance is required above 80% LTV on the standard agency path, with that no-MI lane as the one exception. Leverage, reserves, and pricing vary by lender and program; the final terms follow the full file review.
What Decides Whether You Reach the Cap at All?
The cap is one test among several. Credit, debt-to-income ratio, reserves, seasoning and the appraisal all matter.
- Loan age. The first mortgage you are paying off must be at least 12 months old, measured note date to note date, per Fannie Mae’s cash-out guide. A cash-out right after a recent refinance does not fit.
- Time on title. Programs generally expect you to have been on title for six months, though the exact rule depends on the lender and guide version, so confirm it for your file. Delayed financing is a named exception for a recent all-cash buyer, and inheritance and legal awards are others.
- Reserves. On a Fannie Mae file run through its automated system, a debt-to-income ratio above 45% calls for six months of reserves.
- Pricing. Cash-out loans are priced higher than rate-and-term loans, and the difference lives in the Loan Estimate you compare.
The wholesale conventional programs generally start at a 620 decision score, and the automated finding governs most files. Total ratios run up to 50% on automated approvals.
Cash-Out vs. Rate-and-Term: Why One Pays You and One Doesn’t
A refinance replaces your loan without handing you equity. It is also called a limited cash-out refinance. The new loan pays off your first mortgage, the closing costs and a purchase-money second lien, with only incidental cash back.
In exchange for paying you nothing, this type of loan can reach higher leverage than a cash-out loan. A rate-and-term goes to 95% LTV on a one-unit primary home, or 97% where the existing loan is agency-owned and the first-time-buyer program allows it. A cash-out on a one-unit primary home stops at 80% LTV on the agency path. The one exception is the wholesale lane that reaches 89.99% LTV with no mortgage insurance. Mortgage insurance applies above 80% on the agency path, except in that no-MI wholesale cash-out lane. So the loan that pays you cash generally has the lower ceiling. Buying out a co-owner under a written agreement counts as limited cash-out at both agencies. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
If you hold an FHA or VA loan and only want to lower its cost, the FHA Streamline and VA IRRRL exist for that. They are not cash-out products.
If the Number Is Smaller Than You Hoped
Run the model with your own numbers before you apply. If the cash falls short, you have four choices:
1. Wait. Paying the balance down or letting value grow raises the cash. Seasoning clocks also keep running.
2. Borrow less. A smaller cash-out spreads the same closing costs over fewer dollars, so the math can stop making sense on a small draw.
3. Compare other products. A home equity loan or HELOC leaves your first mortgage in place. The CFPB’s research blog notes that the added risk of a cash-out refinance is that payments and loan terms are both likely to increase.
4. Check the no-MI lane. If you qualify, the higher ceiling can change the answer.
Closing costs can include origination fees, appraisal fees, title insurance and other taxes and fees. The CFPB’s cash-out research lists paying closing costs among the common uses of cash-out funds. That is why the Loan Estimate shows “cash to borrower” and total closing costs as separate lines.
Your Own Number: A Fill-In Worksheet
1. Estimate your home’s appraised value. Treat it as a range, not a point.
2. Multiply by 0.80 for a one-unit primary home, or 0.75 for the other occupancies.
3. Subtract your current first mortgage payoff.
4. Subtract any second mortgage or HELOC you will pay off at closing.
5. Subtract your estimated closing costs and fees. The result is your estimated net cash.
6. Repeat steps 1 through 5 at an appraisal 5% and 10% lower.
If the net cash from step 5 comes out near zero or negative, the cap is not your obstacle. Your existing debt is.
Frequently Asked Questions
Is the 80% limit 80% of my equity or 80% of my home’s value?
It is 80% of your home’s appraised value, and it limits the entire new loan. A home worth 100 can carry a new loan of up to 80. Payoffs and costs come out of that 80, and you receive the remainder.
Does a VA cash-out give me 100% of my home’s value in cash?
No. VA allows the loan to reach up to the full appraised value as VA determines it. That is a limit on the loan. Your payoff, fees and costs still come out first, so the cash is smaller. Individual lenders can also set lower limits.
Can I cash out right after I refinance?
Usually not. The first mortgage being paid off must be at least 12 months old under Fannie Mae’s rules. If you recently bought the home with cash, delayed financing is a named exception, though cash-out pricing and limits still apply. A prior Fannie Mae version of the guide treated a purchase in the prior six months as ineligible unless delayed financing applies, so confirm current wording with your loan officer.
Do closing costs reduce the cash I get?
Yes, if you roll them into the loan or have them taken from proceeds. Either way they come out of the cash. If you pay them separately, you write a check at closing and the loan amount stays the same.
Does a second home change the cap?
Yes. A conventional cash-out on a second home is capped at 75% LTV, five points lower than a one-unit primary home. Occupancy sets the leverage, and the programs apply it to the property you are refinancing. Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
If you are weighing a cash-out refinance against keeping the loan you have, a scenario review with Lendmire can help you compare the programs and the equity each one reaches.
About Lendmire
Lendmire is a mortgage brokerage (NMLS# 2371349) licensed for consumer mortgage lending in 16 states, arranging FHA, VA, conventional and jumbo purchase and refinance loans through a wholesale lending network. Eligibility is determined by the lender on each file. 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. Fannie Mae Selling Guide B2-1.3-03, Cash-Out Refinance Transactions
2. Freddie Mac Guide Section 4203.1
3. CFPB Office of Research blog on cash-out refinance mortgages
4. CFPB research on cash-out refinances and non-mortgage debt paydown
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 Much Cash Comes Out of a Cash-Out Refinance on One Income? · How Much Cash Comes Out of a Cash-Out Refinance to Fund a Down Payment on a New Home? · How Much Cash Comes Out of a Cash-Out Refinance to Access Cash From Home Equity?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
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- 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.