Cash-Out Refinance
CASH-OUT REFINANCE
Turn your home equity into cash.
Turn your equity into cash with a cash-out refi and pay down high-interest debt, or increase your home’s value with a remodel.
•Get dedicated assistance from a Mortgage Loan Officer throughout the process.
• Get your rate in a matter of minutes.
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BTW it’s a soft inquiry, so it won’t affect your credit score.†
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Fund your remodel with a cash-out refi.
Turn your equity into cash with a cash-out refi and fund those new marble countertops.
View your rate
BTW it’s a soft inquiry, so it won’t affect your credit score.†
Why cash-out refi with SoFi?
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Turn your home equity into cash.
Consolidate high-interest debt or pay for home renovations with cash-out refinancing.
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Exclusive member benefits.
SoFi Members save $500 at closing, SoFi Plus Members save $1,000.5
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Save even more.
You could save thousands with a lower rate when you use cash-out refinancing to remodel your home or pay off high-interest debt.
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Get help when you need it.
Our Mortgage Loan Officers are ready to guide you through the cash-out refinance process step by step.
What is cash-out refinancing and how does it work?
Refinancing your mortgage means trading in your old mortgage for a new one. When you refinance, your bank pays off your old mortgage with the new one.
People often choose to refinance their mortgage so they can lower their interest rate and shorten their payment term, or so they can turn the equity they’ve earned into cash. The cash received can be used for nearly any expense—from paying off high-interest debt to financing a home renovation.
Here’s an example.
Let’s say you have a home valued at $300,000. You owe $100,000 on your current mortgage and have $200,000 in equity. You want to borrow $40,000, so you apply for a cash-out refinance for $140,000.
In this scenario, $100,000 of the refinanced mortgage would go toward paying off your existing mortgage along with any other costs due at closing, and the remaining $40,000 would be received in cash.
Learn more
Applying for a cash-out mortgage refi is as easy as 1-2-3.
We’ve made it quick and simple to apply online.
View your rate.
It only takes minutes to explore your options, and it won’t affect your credit score.†
Select your terms.
Choose your mortgage. We offer 10-, 15-, 20-, and 30-year options to meet your financial goals.1-4
Get support.
Dedicated Mortgage Loan Officers are standing by to guide you every step of the way.
View your rate
BTW it’s a soft inquiry, so it won’t affect your credit score.†
Learn more about cash-out refinancing.
Not sure whether mortgage refinancing is right for you? We’ve broken down the pros, cons, and everything in between on SoFi Learn. But for starters, here’s a crash course.
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“Spencer and his team totally went to bat for us and got our loan processed. Very happy with him and his teams efforts and follow up. Communication was excellent right up to the loan funding.”
“Tyler was great to work with — super responsive, transparent, and efficient. He helped me secure a lower rate than I was expecting, and beat another lender’s offer when I brought it to him. The whole process felt smooth and low-stress thanks to his help.
Also want to shout out my Loan Processor Latoya, both Tyler and Latoya worked together to make everything easy! Will absolutely be recommending Tyler & SoFi to my friends/colleagues looking for a mortgage.”
“Ryan and was team were incredibly efficient, helpful and friendly. The whole experience was, as a borrower, so simple and painless. Everybody involved, the SoFi team, Nora the recorder, the insurance agent (who, thanks to Ryan’s introduction) saved me about 50% on my home insurance policy, were great to work with. Ryan got things moving as I had travel commitments, and he took those into account and moved everybody along. Highly recommended.”
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FAQs
Am I eligible for cash-out refinancing?
In addition to having equity in the home, lenders consider a variety of factors to determine eligibility for a cash-out refi. Here are a few examples of what lenders may look for:
Credit score: A higher credit score could help borrowers secure a more competitive interest rate on their cash-out refi.
Loan-to-value (LTV) ratio: This is a percentage reflecting the difference between the outstanding principal balance of the current mortgage versus the current appraised value of your home. For example, a person with a home at an appraised value of $300,000 and a $150,000 remaining principal balance on their existing mortgage has a 50% loan-to-value ratio. ($150,000 / $300,000 = 50%.)
Appraisal value: Some refinances will require a property valuation—typically a recent appraisal. Contact a Mortgage Loan Officer to learn more about our appraisal requirements.
Seasoning: Seasoning relates to the age of a mortgage. If a mortgage is at least 12 months old, lenders generally consider the mortgage “seasoned.” If a mortgage is not considered fully seasoned, it may not be possible to apply for a cash-out refi.
What’s the difference between a cash-out refi and a home equity loan?
Cash-out refinances and home equity lines of credit are two borrowing options that allow homeowners to tap into the equity they have built in their home.
A HELOC is a line of credit secured by the borrower’s home that can be accessed on an as-needed basis, up to the borrowing limit. The borrower is only charged interest and is responsible for repaying the amount they actually borrowed.
For a cash-out refinance, the borrower takes out an entirely new mortgage while borrowing a portion of their existing home equity. The total borrowed amount of the cash-out refinance will be greater than the borrower’s original mortgage, and the borrower will receive the difference in a lump-sum payment from the lender.
Continue reading to learn more about the pros and cons of a HELOC versus a cash-out refinance.
What are the tax implications of a cash-out mortgage refinance?
The interest you pay on your new mortgage is deductible from your taxable income if you use the cashed-out funds to make improvements on your home.
There are stipulations around which home improvements are deduction-eligible, so we recommend consulting a tax professional prior to the start of any renovation project. This said, permanent additions and home improvements that increase the property’s value, extend its longevity, or adapt it for new uses are considered capital improvements, which are generally tax-deductible.
How much money can you get from a cash-out refi?
Generally, lenders will limit borrowers to 80% of the equity they have in their home. VA loans are an exception to this, they allow borrowers to take out 100% of the equity in their home. Contact a Mortgage Loan Officer to learn more about our requirements.
How long does it take to close on a cash-out refi?
On average, cash-out refinancing takes 30 – 45 days to close. However, there are ways to expedite the processing time. The more quickly you provide documentation and secure the appraisal, the more quickly we can process your loan.
What credit score do you need for a cash-out refi?
A credit score of 620 or above is preferable, although—depending on other factors—you may qualify with a score of at least 580.
What are the fees associated with cash-out refinancing?
Borrowers often have to pay closing costs, which can be anywhere from 3% to 5% of the total loan amount (including the old loan and the amount that is cashed out).
What is equity?
Equity is the difference between what you owe on your mortgage and what your home is currently worth. For example, if you owe $200,000 on your mortgage and your home is worth $300,000, you have $100,000 of equity in your home.
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1 30-YEAR Payment Example: The payment for a 30-year term, loan amount $362000.00, Rate 5.875%, LTV 80% is $2141.00 for full Principal and Interest Payments with $6030.92 due at closing. The Annual Percentage Rate is 6.117%. No prepayment penalty. Payment shown does not include taxes and insurance. The actual payment amount will be greater. Interest rates and annual percentage rates (APRs) are for informational purposes only and are subject to change without notice.
2 20-YEAR Payment Example: The payment for a 20-year term, loan amount $362000.00, Rate 5.750%, LTV 80% is $2542.00 for full Principal and Interest Payments with $6041.78 due at closing. The Annual Percentage Rate is 6.072%. No prepayment penalty. Payment shown does not include taxes and insurance. The actual payment amount will be greater. Interest rates and annual percentage rates (APRs) are for informational purposes only and are subject to change without notice.
3 15-YEAR Payment Example: The payment for a 15-year term, loan amount $362000.00, Rate 5.125%, LTV 80% is $2886.00 for full Principal and Interest Payments with $4901.48 due at closing. The Annual Percentage Rate is 5.474%. No prepayment penalty. Payment shown does not include taxes and insurance. The actual payment amount will be greater. Interest rates and annual percentage rates (APRs) are for informational purposes only and are subject to change without notice.
4 10-YEAR Payment Example: The payment for a 10-year term, loan amount $362000.00, Rate 5.250%, LTV 80% is $3884.00 for full Principal and Interest Payments with $5194.70 due at closing. The Annual Percentage Rate is 5.767%. No prepayment penalty. Payment shown does not include taxes and insurance. The actual payment amount will be greater. Interest rates and annual percentage rates (APRs) are for informational purposes only and are subject to change without notice.
