What is a conventional cash-out refinance?
A conventional cash-out refinance pays off the existing mortgage and gives the borrower additional cash from accumulated equity. Maximum LTV is typically 80% on a 1-unit primary residence, lower on multi-unit and investment. Pricing carries cash-out LLPAs that have tightened in recent years.
Plain-English explanation
Cash-out math: loan balance at closing = existing payoff + new cash to borrower + closing costs (if rolled in). Maximum LTV: 1-unit primary 80%; 2-4 unit primary 75%; second home 75%; investment 1-unit 75%, 2-4 unit 70%. Cash-out LLPAs are layered on top of credit/LTV adjustments and have grown materially since 2023 updates. Compare against HELOC for smaller equity needs — HELOC pricing often beats cash-out refinance below 50% combined LTV. Subject to Fannie/Freddie guidelines.
What can change the answer?
Rate environment, equity, credit, current loan type, seasoning, AUS findings (appraisal waiver eligibility), and program rules can change the answer.
Want the real answer for your conventional file?
Conventional guidelines are the rule. Your credit, income, DTI, PMI, LLPAs, and Florida payment math are what decide the actual answer.
More conventional questions on Refinance
Educational only. Conventional loan guidelines, lender overlays, rates, fees, PMI, LLPAs, and underwriting requirements can change. Final eligibility depends on full underwriting review.