What is a VA cash out refinance?

A VA cash out refinance helps you get cash from the equity in your home. These refinances let you replace your current mortgage with a new VA mortgage for a higher amount, and get the difference in cash when you close your new loan.

For example, pretend your current mortgage balance is $125,000. With a VA cash out refinance, you might be able to get a new VA mortgage for $175,000 plus $50,000 in cash. You can use this cash to pay for home improvements and college educations or to help you consolidate higher interest debts.

Veterans, military personnel, and surviving spouses may be eligible for VA cash out refinances. You will need to meet credit, income, and financial requirements to get your application approved. 

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VA cash out refinances

• Only qualified veterans, military personnel, and surviving spouses are eligible

• Maximum loan-to-value ratio often 90%

• Minimum credit score often 550

• Mortgage insurance not required

• Most veterans will pay a funding fee of 2.3% to 3.6% of loan amount