Top FHA Cash-Out Refinance Providers for Homeowners With an Existing FHA Mortgage

The Quick Read: There is no official ranking of FHA cash-out providers, and the right one depends on your credit, equity, and file. HUD sets the rules, and each approved lender adds its own requirements. The FHA cash-out loan is capped at a maximum loan-to-value set by HUD and requires that you have owned and lived in the home for 12 months. It replaces your current FHA loan with a new one, so the smart move is to compare how lenders handle your specific situation, not to chase a list. Terms depend on the lender’s guidelines, the property type, the leverage, and a full review of the credit profile.

What Is an FHA Cash-Out Refinance When You Already Have an FHA Loan?

An FHA cash-out refinance is a new FHA loan that pays off your current mortgage and hands you the leftover equity as cash. If your current loan is already FHA, the comparison between options changes, but that is not a requirement. Whichever loan you hold now, it is paid off at closing, and a new one takes its place.

Three things reset. The loan balance grows. The mortgage insurance schedule starts over under the new loan. The payoff term begins again.

Why There Is No Honest “Top Providers” List

FHA rules are the same everywhere. HUD publishes them in Handbook 4000.1, and the HUD Housing Handbooks page shows when it was last updated, so check the current version before relying on any summary, including this one.

What differs between lenders is the layer on top: credit-score floors, how strictly they read a payment history, and how they handle unusual files. Which lenders write your loan well depends on your situation, so no single list can answer that for every homeowner. A broker that shops several wholesale lenders can match the file to the program. A single-lender website cannot do that comparison for you.

How the Loan Is Underwritten, Step by Step

Step 1: Eligibility screen. The home must be your principal residence. You must have owned and lived in it for 12 months before the FHA case number is assigned. Your mortgage payments must show a clean record over the lookback period, and the cash-out test is stricter than the one for a no-cash-out refinance.

Step 2: Case number and appraisal. The lender orders an FHA case number. That starts the 12-month clock. An FHA appraisal then sets the value used for the loan limit.

Step 3: Maximum loan. The cap is 80% of the adjusted value. Your payoff, any liens, and any costs you roll in all come out of that 80% first. Cash to you is only what remains.

Step 4: Credit and income review. This is a full-credit refinance. Unlike a Streamline, it reviews your income, debts, and credit. Without compensating factors, the base ratios are 31% for housing costs and 43% for total debt. Documented compensating factors, such as reserves or a strong payment history, can raise those ratios to as much as 40% for housing and 50% for total debt at the top tier, and the automated finding governs most files. The wholesale programs we place FHA loans with start at a 580 decision score.

Step 5: Disclosures. You receive a Loan Estimate and later a Closing Disclosure. Total closing costs show separately from cash to close.

Step 6: New endorsement. The new loan replaces the old FHA loan, with a new case number, a new insurance schedule, and a new term.

How Mortgage Insurance Works on the New Loan

FHA mortgage insurance has two parts. The upfront premium is 1.75% of the base loan and is usually financed into the balance. The annual premium runs between 0.15% and 0.75% of the balance, depending on term, loan amount, and LTV.

Duration matters. On a thirty-year loan above 90% LTV, the annual premium lasts for the full term. At or below 90%, it ends after eleven years. HUD cut the annual premium for loans endorsed on or after March 20, 2023, according to HUD’s FHA INFO 2023-11 notice, and the schedule now lives in the handbook. The exact numbers follow a full review of property, leverage, and credit.

That is a program mechanic, not a promise on your file. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.

Cash-Out, Streamline, or Keep Your Loan?

This is the decision most existing-FHA homeowners actually face.

A Streamline refinances an existing FHA loan with no appraisal, a limited credit review, and a net tangible benefit. It cannot put cash in your pocket. If your goal is a better term and not cash, it is usually the lighter path. If you need cash, only a full cash-out gets it.

Cash-out makes the most sense when the need is real and the equity is solid. It makes less sense when the cash only replaces credit card debt. The CFPB’s report on cash-out borrowers found that paying off other debts was the most common reason, chosen by more than half of respondents each year from 2014 to 2019. It also found credit card balances trended back toward pre-refinance levels within a year. Spending the equity once is easy. Keeping the balances down afterward is the hard part.

Where the General Rule Breaks

Owned less than 12 months. Standard cash-out is generally unavailable. Inherited homes are a named exception area, and the handbook treats an inherited home differently depending on how it was used. Confirm with a lender.

Free-and-clear homes. A new loan on a home with no mortgage still counts as a cash-out.

Hawaiian Home Lands. Loans on Hawaiian Home Lands may follow separate HUD rules, so the 80% cap may not apply the same way. Ask the broker to confirm the current handbook treatment for your property.

Taking any real cash. Once you take more than incidental cash, the loan is a cash-out and the 80% cap applies. A rate-and-term refinance reaches 97.75% on a principal residence you have occupied for the previous twelve months, so the gap is large.

Old guidance. Pages that quote 85% or 95% are out of date. HUD’s announcement lowered the cap from 85% to 80%, after a cut from 95% to 85% in 2009.

Recent late payments. A late payment inside the lookback period can stop a file regardless of credit score. The 80% cap does not change with a higher score.

Rentals and second homes. Occupancy decides the leverage, and standard FHA cash-out is for a principal residence only.

What Changes for Your Budget

A bigger loan usually means a bigger payment and a longer payoff. The CFPB’s guide to using home equity says a cash-out may extend the time it takes to pay off your mortgage and may increase your monthly payment. Compare the all-in monthly cost, including mortgage insurance, against what you pay now.

Closing costs also reduce your net cash. Costs you roll in sit inside the 80% cap. A “no closing cost” offer is not free. The CFPB explains that those costs are covered either by a lender credit paid for through a higher interest rate, or by a higher loan balance, as described in its loan cost guide.

A break-even check helps. Add up what you give up, such as a restarted term and insurance, and weigh it against what the cash does for you. If the cash retires costly debt for good, the math may hold. If it funds spending you would not otherwise make, the answer is usually to skip it.

Key Terms Defined

Adjusted value: The appraised value as FHA adjusts it, which is the number the 80% cap is measured against.

Case number: The FHA identifier a lender orders at the start of the file, which also starts the 12-month lookback.

Net tangible benefit: The measurable gain an FHA Streamline must show to be allowed.

Upfront premium: The one-time FHA insurance charge, 1.75% of the base loan, usually financed.

Compensating factors: Documented strengths, such as reserves or a strong payment history, that allow higher debt ratios.

How to Choose a Provider

Ask each lender for a Loan Estimate on the same loan amount, and line them up. Then ask:

• What is your minimum credit score for FHA cash-out?
• How do you read the 12-month payment history?
• Is the lender FHA-approved and licensed in my state?
• What costs are rolled in, and what is built into the loan through a lender credit?

Walk away from pressure to decide on the spot, and from sites that collect your details without naming who will actually make the loan.

A broker shops multiple wholesale lenders and matches your scenario to the program, but a broker is not the lender, and approval stays with the lender. Lendmire is licensed for consumer lending in 16 states, including Texas, Florida, California, and Georgia. County loan limits apply and change every year.

Next Step

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 the team at 828-256-2183.

All program details are subject to lender guidelines and full file review, and nothing here is a commitment to lend.

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.

References

1. HUD Housing Handbooks page

2. HUD FHA INFO 2023-11

3. CFPB: CFPB Report Finds Cash Out Mortgage Refinance Borrowers Improve Credit Scores

4. HUD news release 19-114

5. CFPB Older Americans guide, using home equity

6. CFPB loan costs guide

7. FDIC’s streamline summary