Tapping into your home’s equity can be a smart move, whether it’s to lower high-interest debt, fund a home renovation, pay for college tuition or make progress toward another financial goal. One way you can accomplish this is through a cash-out refinance, in which you refinance your mortgage for more than what you owe and take the difference out in cash. Many mortgage lenders offer cash-out refinancing, and Bankrate evaluated several to determine the best ones to consider. Here are our picks for the best cash-out refinance lenders in 2023.

Bankrate’s picks for best cash-out refinance lenders

Cash-out refinance lender Bankrate rating Minimum credit score
Garden State Home Loans 5/5 640 (580 for some loans)
Sage Mortgage 4.9/5 620 for conventional loans, 500/580 for FHA loans
LowRates.com 4.8/5 620 for conventional loans, 620 for jumbo loans, 500 for FHA loans, 500 for VA loans
ZeroMortgage 4.1/5 620 for conventional loans
Blue Spot Home Loans 4.8/5 620 for conventional loans, 700 for jumbo loans, 600 for FHA loans, 620 for VA loans, 540 for USDA loans
  • To determine the best cash-out refinance lenders, Bankrate evaluated lenders based on several criteria, including cost (competitive cash-out refinance rates and low or no fees); speed (approval and closing times); and borrower testimonials.

Garden State Home Loans

Bankrate Score: 5/5
Why we chose Garden State Home Loans: With the maximum 5-star Bankrate Score, this lender is top-of-the-line across the board.
Loan products: Purchase and refinance (including cash-out refinance), conventional, jumbo, VA, USDA, come equity loan, construction and renovation loans
Nationwide availability: Available in Connecticut, Delaware, Florida, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Pennsylvania, Tennessee, Texas and Virginia
Pros:
  • Online chat feature to communicate with loan officer
  • Closings typically in 40 days
Cons:
  • Not available in all states
  • Not all fees disclosed online
Link to full review: Garden State Home Loans Mortgage Review

Sage Mortgage

Bankrate Score: 4.9/5
Why we chose Sage Mortgage: Sage Mortgage can be a quick and easy option for those who want to complete the entire cash-out refinancing process online. Because Sage Mortgage works with multiple wholesale lenders, you’re likely to find a competitive offer. (Editor’s note: Sage Mortgage is affiliated with Red Ventures, parent company of Bankrate.)
Loan products: Purchase and refinance (including cash-out refinance), conventional
Nationwide availability: Available in Alabama, California, Colorado, Connecticut, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Maryland, Michigan, Minnesota, New Hampshire, New Jersey, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Washington and Wisconsin
Pros:
  • Closings average 27 days
  • Application is entirely online
  • Ability to get matched with the best rate for your circumstances
Cons:
  • No government-insured loans
  • No HELOCs (home equity line of credit) or home equity loans
Link to full review: Sage Mortgage Review 2023

LowRates.com

Bankrate Score: 4.8/5
Why we chose LowRates.com: You can apply for a cash-out refinance through the LowRates.com website, with full credit underwriting completed in just 24 hours. If you want to work with a loan officer in-person, you’ll have that option at a Sun West Mortgage Company branch.
Loan products: Purchase and refinance (including cash-out refinance), conventional, jumbo, FHA, VA, USDA, HELOC and home equity loan, construction and renovation loan, investment property, reverse mortgage
Nationwide availability: Available in all states but Georgia and Massachusetts
Pros:
  • TRU Approval program provides complete credit underwriting in under 24 hours
  • Closings in as few as 20 days
  • Down payment assistance available to eligible borrowers
Cons:
  • Sun West Mortgage branch locations only available in some states
  • Loans not available in Georgia or Massachusetts
Link to full review: LowRates.com Mortgage Review 2023

ZeroMortgage

Bankrate Score: 4.1/5
Why we chose ZeroMortgage: ZeroMortgage, an affiliate of Interfirst Mortgage Company, is an online-only mortgage lender headquartered in Chicago. If you qualify, you could get a preapproval in as little as one day, and close in 30 days to 45 days.
Loan products: Conventional, jumbo, fixed-rate, adjustable-rate, refinancing, investment Property
Nationwide availability: Available in most states (not Alaska, Massachusetts, New Jersey, Nevada, New York, Vermot, Washington)
Pros:
  • Fast preapproval
  • Online application process
  • No fees
Cons:
  • Doesn’t consider alternatives to traditional credit scores
Link to full review: ZeroMortgage Review 2023

Blue Spot Home Loans

Bankrate Score: 4.8/5
Why we chose Blue Spot Home Loans: Blue Spot Home Loans, an online lender part of Cherry Creek Mortgage, offers a streamlined online application experience, complete with speedy closings. This lender is very transparent about rates on its website, which includes a customizable rate tool.
Loan products: Purchase and refinance (including cash-out refinance), conventional, jumbo, FHA, VA, USDA, construction and renovation loans, reverse mortgage
Nationwide availability: Available in 44 states (not available in Alaska, Hawaii, Massachusetts, New York, Vermont, Virginia or Washington, D.C.)
Pros:
  • Will consider alternative credit data
  • Speedy online application process
Cons:
  • Not available everywhere
Link to full review: Blue Spot Home Loans Review 2023

How to choose the best cash-out refinance lender for you

Every lender’s menu of refi options is a little different. You’ll want to choose one that’s active in your geographic area and offers the type of loan program that you’re interested in. Because cash-out refinance loans pose a bit more risk to the lender than a traditional rate-and-term refinancing, underwriting standards can be stricter. So check to see if your credit score and hoped-for loan-to-value ratio fit the lender’s guidelines. As you weigh your options, you also should weigh the pros and cons of cash-out refinancing in general.

Next steps for a cash-out refinance

Ready to start shopping around? Because rates run higher for cash-out refinances than for rate-and-term refis, comparing lender offers and deals is crucial. Looking at multiple offers can save you thousands of dollars. To make sure you understand how your credit score and other factors affect your rate, see our guide to getting the best cash-out refinance rate.

Frequently asked questions about cash-out refinancing

  • To be eligible for a cash-out refinance, you typically need to:
    • Have a minimum credit score of 620
    • Have a debt-to-income (DTI) ratio below 50 percent
    • Maintain a minimum 20 percent equity in your home following the cash-out (depending on loan type)
  • A cash-out refinance is typically the most beneficial when interest rates are low, and for borrowers who meet the requirements and have specific goals for the funds they’re withdrawing. This includes those seeking to consolidate high-interest debt, complete home renovations or fund a college education.
  • How much you can cash out on your home varies, and most lenders want to see you maintain at least 20 percent equity after the refinance. For example, let’s say your home is currently valued at $200,000, and you have $120,000 left to pay on your mortgage. With that much equity ($80,000, or 40 percent), you might be able to refinance your loan to a new one with a higher balance and take cash out, so long as you retain at least 20 percent equity when all is said and done.
  • In a rate-and-term refinance, you lower the rate on your mortgage, change the length of the loan term, or both, but the principal (the amount you borrow) remains the same. A cash-out refinance can also lower your rate, but since it involves withdrawing a portion of your home’s equity in a lump sum, it adds to the overall size of your loan and increases the interest you’ll pay. Those funds can be used for a variety of purposes, such as a major home renovation.
  • A cash-out refinance isn’t the only way to tap your home’s equity; you can also pursue a home equity line of credit (HELOC).A HELOC isn’t a refinance at all — your first mortgage remains intact — but is more akin to a big credit card, establishing a revolving source of funds that you can tap, repay and then borrow again. It’s an additional debt, on which you pay interest at a variable rate. The advantages of a HELOC are that you’re only responsible for paying what you use, you can access the funds at any time and you won’t incur interest on untapped funds. However, HELOCs come with variable interest rates, which means they can change, and they could be higher than what you’d get with a traditional cash-out refinance. See Bankrate’s home equity loan or HELOC vs cash-out mortgage refinance page.