How does a cash-out refinance on a rental work?
A cash-out refinance on a rental replaces the existing loan with a larger one and gives you the equity difference in cash, usually up to 75% of the property's value. Investors use it to fund the next purchase.
You can qualify conventionally on income or via DSCR on the property's rent. Rental cash-outs carry slightly higher rates than primary homes. We'll structure it to free up capital while keeping cash flow positive.
Pulling equity from a rental
A cash-out refinance on a rental replaces your current loan with a larger one and gives you the difference in cash. Investors use it to fund the next purchase or improve the property.
Lenders usually limit rental cash-out to about 70% to 75% of the property's value, leaving more equity in place than on a primary home.
Rates and qualifying
Rental cash-out refinances carry slightly higher rates, and the property's rental income helps you qualify. A DSCR refinance can qualify on the rent alone.
It is a key tool for growing a portfolio. Apply now and we will run your rental cash-out numbers.
Verify the details for your own situation against these government and agency sources: CFPB guide to refinancing and CFPB Owning a Home guide.