Cash-Out Refinance Calculator for Investment Property

Maximum loan is the program's cash-out LTV cap times the appraised value, less the balance being paid off and closing costs. Cash-out on business-purpose DSCR loans is commonly capped near 75% LTV, with lower caps for short-term rentals and foreign-national borrowers.

Loan proceeds are generally not income, but tax treatment depends on your situation and on how the proceeds are used. Confirm with your CPA — we do not provide tax advice.

Divide closing costs by the monthly benefit — the return you expect on redeployed proceeds, net of any increase in the payment. This tool shows that in months.

Usually yes, because the balance and the payment both rise while rent stays the same. The calculator shows DSCR before and after so you can see whether the new ratio still clears the program floor.

Many programs require an ownership period before pricing cash-out off current appraised value rather than the purchase price plus documented improvements. Requirements vary by program.

Because maximum loan is calculated as appraised value times the program's LTV cap, a lower-than-expected appraisal directly reduces both the maximum loan amount and the net cash you receive after payoff and closing costs. This is why many investors run this calculator at a few conservative value scenarios rather than only their expected appraisal.

Yes, this is often called a delayed-purchase or delayed-financing cash-out refinance, and it lets an investor recover capital tied up in an all-cash purchase. Many DSCR programs require a minimum ownership period before basing the new loan on appraised value rather than the original purchase price, so check the specific program's seasoning rule.

A rate-and-term refinance replaces the existing loan without taking meaningful cash out, generally used to change the rate or term, while a cash-out refinance pulls equity above the current payoff for reinvestment or other use. Cash-out refinances typically carry a lower maximum LTV than rate-and-term because the lender is extending more net new credit against the property.

You generally need enough equity so the resulting loan-to-value at the program's cash-out cap still leaves meaningful proceeds after payoff and closing costs, commonly meaning at least 25%–35% equity as a starting point. Below that, the transaction may generate too little net cash to justify the closing costs and rate reset.

Refinancing pays off the existing loan, which can trigger any remaining prepayment penalty on that loan, and the new loan will carry its own prepayment structure. Check the current note's penalty schedule and compare it against the new loan's terms before deciding on timing.

Business-purpose DSCR cash-out refinances commonly take a few weeks from application to closing, driven mainly by appraisal scheduling and title work rather than income documentation. Timelines vary by property complexity, title issues, and appraiser availability in the local market.

Yes — DSCR loans qualify primarily off the subject property's rent relative to the new payment rather than the borrower's personal income, which is why the calculator shows before-and-after DSCR. Programs typically require the ratio to clear a minimum threshold, and figures shown here are illustrative estimates subject to credit review, appraisal, and full underwriting.