What Is a Cash-Out Refinance Loan?
A Cash-Out Refinance Loan is a type of real estate loan that allows you to pull equity from a property you already own by refinancing it for more than the current loan balance — giving you cash at closing to reinvest, pay off debts, or fund new projects.
This is one of the most powerful tools for scaling a real estate portfolio using existing assets.
Instead of selling a property to access your profits, a cash-out refinance lets you:
Keep the property
Replace your current loan with a larger one
Receive the difference in cash
Current Property Value - $300,000
Current Mortgage Balance - $150,000
New Loan (70% LTV) - $210,000
Cash Out - $60,000 (after payoff)
How It Works:
Investors needing fast capital to fund new deals
Owners with significant equity in a rental or flip
Real estate pros who want to leverage appreciation
Builders needing working capital
Ideal For:
No need to sell a performing asset
Fast closings with limited documentation
Can be used to consolidate debt or fuel multiple deals
Works great alongside DSCR or fix & flip strategies
Benefits:
You now have a new loan of $210,000, pay off the $150,000 balance, and walk away with $60,000 cash (minus closing costs).
Sell the property later at peak value
Refinance again into a long-term DSCR or conventional loan
Use rental income to pay down the new loan
All the best