The practical path to turning idle equity into working capital — estimate your equity, qualify on the rent, skip the seasoning wait, and redeploy the cash.
If you’re sitting on equity in a rental, a cash-out refinance turns that idle value into working capital for your next deal — without selling the property. On investment property it’s typically underwritten through a DSCR loan, qualifying on the property’s rent rather than your personal income. This guide walks through how to cash-out refinance an investment property, step by step.
For the full product breakdown, see our cash-out refinance program; below is the practical path.
Step 1: Estimate Your Available Equity
A cash-out refinance replaces your current loan with a larger one and hands you the difference. On investment property, lenders cap the new loan at roughly 70% to 80% loan-to-value, so the more your property is worth relative to what you owe, the more you can pull. Start by estimating the current value and subtracting the existing balance and the lender’s cushion.
Step 2: Confirm the Property Cash-Flows
Because the refinance is underwritten on rent, the property needs to cover the new payment. We use the DSCR — rent against the new mortgage payment — and there’s no minimum DSCR, so even a thinner ratio can work with adjusted terms. No tax returns or W-2s are required.
Step 3: Know the Seasoning Rules
This is where many investors get tripped up. Some lenders make you wait six to twelve months before refinancing on a property’s new, higher value. Our DSCR cash-out has no seasoning requirement when the property has been renovated — we use the current, improved value right away, which is what makes it the engine of a BRRRR strategy.
Step 4: Submit and Get Your Terms
Provide the property’s current value, the existing loan balance, and the rent. You’ll get a quote with the loan amount, rate, and how much cash comes back to you. Credit is reviewed, but there’s no minimum score, and on a cash-out you can typically use the proceeds themselves to satisfy the reserve requirement rather than bringing separate cash.
Step 5: Close and Redeploy
With a DSCR-based cash-out qualifying on rent, the documentation is light and the close is fast. The cash that comes out is yours to redeploy — into the next acquisition through a short-term fix and flip or bridge loan, or to hold more rentals via our DSCR and rental loan programs.
Cash-Out Refinance at a Glance
Cash-Out Refinance at a Glance
Frequently Asked Questions
It depends on your equity and the loan-to-value cap, which on investment property runs up to about 80%. The lender lends up to that percentage of value, pays off your existing loan, and the remainder comes to you as cash.
Not with us, on a renovated property. Our DSCR cash-out has no seasoning requirement when the property has been improved — we use the current value right away rather than your original purchase price.
Yes. Through a DSCR-based cash-out, the loan qualifies on the property’s rental income, so there are no tax returns, W-2s, or debt-to-income calculations.
Usually, yes. The reserves a lender wants after closing can come from the cash you’re pulling out, so you don’t have to bring separate funds to the table.
There’s no minimum credit score. A stronger score earns a better rate and more leverage; a lower score is offset with more conservative terms, not a denial.