How to Use Cash-Out Refinance Calculator
The Cash-Out Refinance Calculator quantifies the trade-off of converting home equity into cash.
- Enter home value and current mortgage balance — These define your existing equity.
- Enter the new loan amount — Must be larger than the current balance to pull cash out.
- Enter new rate, term, and closing costs — From the lender’s offer.
- Read the result — The Cash-Out Refinance Calculator shows cash to you, new LTV, new monthly payment, total interest, and total paid.
Formula & Theory - Cash-Out Refinance Calculator
The Cash-Out Refinance Calculator combines amortization math with equity arithmetic:
CashOut = NewLoan − CurrentBalance − ClosingCosts
NewLTV = NewLoan / HomeValue
i = NewRate / 12
n = NewTermYears × 12
Monthly = NewLoan × i × (1+i)^n / ((1+i)^n − 1)
TotalPaid = Monthly × n
TotalInterest = TotalPaid − NewLoanTrade-offs of cash-out refinancing:
- You keep one loan, one rate — Simpler than juggling a mortgage and HELOC.
- You may receive a fixed rate — Locked for the life of the loan.
- You pay closing costs again — Typically 2–5% of the new loan amount.
- You restart amortization — Resetting to a fresh 30-year schedule pushes more interest forward.
- You increase total mortgage interest — Borrowing against equity is borrowing.
LTV limits:
| Program | Cash-Out LTV Cap |
|---|---|
| Conventional | 80% |
| FHA | 80% |
| VA | up to 100% |
| Jumbo | varies (60–80%) |
If your new LTV exceeds 80%, you may also owe private mortgage insurance (PMI) until the balance falls below that threshold. The Cash-Out Refinance Calculator surfaces the new LTV so you can plan around PMI.
Use Cases for Cash-Out Refinance Calculator
- Home improvement funding — Convert equity into a kitchen or bathroom remodel.
- Debt consolidation — Pay off high-rate credit cards or personal loans.
- Tuition and education — Fund higher education at mortgage rates.
- Investment property down payment — Use equity from one home to buy another.
- Emergency reserves — Build a large cash buffer for an uncertain period.
- Rate-and-term + cash-out combo — Lower the rate while also pulling cash.
The Cash-Out Refinance Calculator turns a major financial decision into transparent monthly and lifetime numbers.