One of the most obvious reasons for refinancing a mortgage is to take advantage of a lower interest rate. But even if you have a low interest rate, there are other reasons to consider refinancing, including accessing any potential equity in your home.

If the current market value of your home exceeds how much you owe on it, the difference is considered equity. The amount of equity you may have could vary based on a number of factors and may fluctuate from time to time, due to changes in the real estate market. Through a cash-out refinance, you may be able to utilize at least a portion of your equity as you see fit.

Homeowners may wish to get cash out of their homes for a number of reasons. Some refinance to consolidate debts with higher interest rates, while others use the proceeds to pay for education or medical expenses. And while certain loan programs may have some exceptions, there generally aren’t restrictions on how you use your equity.

Be aware that just because you owe less on your home than it’s worth, doesn’t mean you’ll be able to access all – or even any – of its equity. Loan-to-value (LTV) is a major consideration for most cash-out refinances. For instance, some loan programs may only permit you to take cash out up to 80% LTV.

Let’s consider a simplified scenario to illustrate this. If your home is valued at $300,000 and you owe $210,000, you have $90,000 of equity and 70% LTV. If you pursue a loan that only allows you to take cash out up to 80% LTV, you may only be able to access the equity over and above 20% of the home’s value. In this case, that would be $30,000.

The good news is there are loan programs that allow qualified borrowers to take cash out up to 100% LTV. A licensed loan officer can help you determine which program may best meet your particular needs for a cash-out refinance.

Contact a loan officer near you for more information and to begin your application today.


Castle & Cooke Mortgage, LLC® (NMLS #1251) is a leading independent mortgage lender headquartered in Draper, Utah, with locations across the United States.

Restrictions may apply. Not all who apply will qualify. Program qualifications & offerings are subject to change at any time. Castle & Cooke Mortgage, LLC is not affiliated with, or endorsed by, the U.S. Government. Equal Housing Lender. Castle & Cooke Mortgage, LLC is licensed in AL, AR, AZ, CA, CO, CT, FL, GA, HI, ID, IL, IN, IA, KY, MD, MI, MS, MO, NE, NV, NM, NC, ND, OH, OK, OR, TN, TX, UT, WA, WI and WY. Licensed by the Arizona Department of Financial Institutions, Arizona Mortgage Banker: BK-0908287. Licensed by the Department of Business Oversight, under the California Residential Mortgage Lending Act License #4130740. Regulated by the Colorado Division of Real Estate. Georgia Residential Mortgage Licensee, License #43759. Illinois Residential Mortgage Licensee. Licensed by the Mississippi Department of Banker and Consumer Finance. Ohio Mortgage Loan Act Certificate of Registration #SM.502008.000. Oregon Mortgage Lending License #ML-4090. Washington #CL-1251.