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Cash-out refi or HELOC: which gets my cash for less?

If your current mortgage rate is low, repricing the whole balance to reach some cash can be the expensive path. Enter your numbers and the rates you've been quoted to see the side-by-side.

Cash-out refi vs. HELOC

Which way to get cash has the lower payment?

Your current mortgage

Needed

Estimated from your balance, rate and years left. Type the payment from your statement to use it instead.

Cash you need

Option A: keep your mortgage, add a HELOC

Needed

Option B: cash-out refinance

Needed

Lower monthly payment

Add the three rates to compare

• Your current mortgage rate

• The HELOC rate you were quoted

• The refinance rate you were quoted

This calculator never fills in a rate for you.

Total you would owe
$500,000
Check my HELOC options →Or talk through both with Randy

Prefer to talk now? Call (949) 990-6030

Estimates based only on the numbers you enter, for illustration. Not a loan offer, a rate quote, or a commitment to lend. Subject to credit approval.

Lower monthly paymentAdd your rates
See breakdown

The short answer: whichever option prices the least money at the higher rate. A cash-out refinance reprices your entire balance at today's rate; a HELOC or HELOAN reprices only the new cash while your first mortgage keeps its existing rate. The blended rate, the balance-weighted average of the two, is the honest number to compare against the refinance quote.

How does the blended-rate math work?

Multiply each balance by its rate, add them together, and divide by the combined balance. The bigger your low-rate first mortgage is relative to the cash you need, the harder it is for a full refinance to beat the blend.

When does the full cash-out refinance win?

When your existing rate is near or above today's refinance rates, when you want one payment instead of two, or when the refinance also fixes something else (removing mortgage insurance, shortening the term). Closing costs matter too: the calculator shows each option's APR with costs included.

Illustrative example: not an offer or a rate/APR quote

A homeowner owes $500,000 on their first mortgage and needs $100,000 in cash.

Path A keeps the $500,000 first mortgage exactly as it is and adds a $100,000 HELOC, so only $100,000 gets priced at a new rate. Path B replaces everything with one new $600,000 loan, so all $600,000 gets priced at today's rate. Which path costs less each month depends entirely on the three rates involved, so enter your actual quotes above and let the blended-rate math decide.

Frequently Asked Questions

Should I do a cash-out refinance or add a HELOC?
It usually comes down to your current first-mortgage rate. If it's well below today's refinance rates, repricing your entire balance to pull out cash is expensive; keeping the first mortgage and adding a HELOC or HELOAN often wins. If your current rate is near or above today's rates, a single cash-out refinance can be cleaner. The calculator compares both with your actual numbers.
What is a blended rate?
It's the weighted average rate across your first mortgage and the new HELOC/HELOAN, weighted by balance. A large low-rate first mortgage plus a smaller higher-rate HELOC often blends to less than a full refinance at today's rates. The calculator leads with the monthly payment, the reason most people pick one path, and also shows total cost, interest plus closing costs, because a lower payment can still cost more when one option runs for more years.
Why does the calculator ask me to type the rates?
Because your real rates depend on credit score, equity, occupancy, and program. Pre-filling a rate would just be a guess dressed up as an answer. Enter the quotes you've actually received and the comparison becomes real.
Can I get a HELOC in Texas?
Yes. Texas home-equity loans, including HELOCs, follow Texas's Section 50(a)(6) rules, such as an 80% combined loan-to-value cap. A key program qualifier is whether your existing first mortgage is itself a Texas cash-out loan; if your current first lien is a standard purchase or rate-and-term refinance, a HELOC is typically available. Availability varies by lender and program.
What closing costs should I include?
Lender fees and points for whichever option you're pricing. They go into each option's APR and total cost, so a low rate with heavy fees doesn't look like the cheaper path.

Calculator results are estimates based only on the numbers you enter and are for educational purposes. Enter the rate you have been quoted. This tool never assumes or suggests a rate. Subject to credit approval. Your home is used as collateral and may be at risk if you do not repay. APR, terms, and repayment structure vary by product.

Rates and program availability may vary based on the state or region in which the financed property is located. This is not a credit decision, an offer, or a commitment to lend. Program restrictions apply.

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