Get Cash Out: What's the Cheapest Way?
If you need cash from your equity, a cash-out refinance replaces your whole first mortgage at today's rates. A 2nd lien (HELOAN or HELOC) keeps your first exactly as it is and borrows only the new money at today's rates. Here's the honest math on both.
Your current first mortgage
The rate you might be giving up — it sets your existing payment and anchors the blended rate.
What you want to pull out
The cash amount and how long you'll keep the loan drive which option costs less.
Today's rates
Cash-out pricing is live from our engine and depends on credit and state. The 2nd-lien rate is your estimate until we quote it.
When each usually wins
2nd lien wins when:
- Your first is below ~5% and worth keeping
- You need a modest amount vs. your balance
- Combined LTV stays within ~80–85%
Cash-out wins when:
- Your current rate is near or above today's
- You want one payment instead of two
- LTV after cash-out stays under 80%
HELOAN vs HELOC
A HELOAN is a fixed-rate, fully amortizing 2nd mortgage — one lump sum, fixed payment, principal pays down monthly.
A HELOC is a revolving line tied to Prime. During the draw period you pay interest only; after it, the balance converts to a fully amortizing payment that can jump significantly. Best as a short-term tool — plan to refinance or pay off before the draw ends.
The cash-out rate is today's par rate from NetRate Mortgage's live pricing engine for the scenario you entered; the 2nd-lien rate is your estimate until we quote it. HELOC mode models interest-only payments during the draw period only — the post-draw amortizing payment can be materially higher and depends on the then-current variable rate. Actual rates and payments depend on credit, LTV/CLTV, property type, occupancy, and other factors. Licensed in CA, CO, OR, and TX. NMLS #1111861.