Refinance Calculator — Cash-Out Refinance
The equity-extraction view: the new loan equals your payoff balance plus the cash you take, and the calculator prices what that really costs. Taking $40,000 from a $300,000 loan at 6.5% barely moves the payment — $2,149.03 vs $2,162.20 — yet adds $40,097.97 of lifetime cost versus staying put, because the cash rides a 30-year amortization. Use it to compare pulling equity here against a HELOC.
Refinance comparison
Break-even point
88 months
saving $68.76 per month after closing costs of $6,000
Breakdown
Lifetime cost increase (interest + closing costs vs staying put): $19,085
Compares the loans you enter, ignoring tax effects and escrow changes. Not a rate quote, lending decision, or financial advice.
The payment hides what the term reveals
Spreading $40,000 over 30 years at mortgage rates keeps the payment flat while interest accumulates relentlessly — that's the whole trick of the structure. The honest comparison is lifetime cost against your alternatives: a HELOC prices the $40,000 alone at a higher, variable rate but leaves your first mortgage untouched; a cash-out reprices everything at today's rate. Which wins depends almost entirely on the gap between your current rate and the market's.
Lenders also cap cash-out refinances at stricter loan-to-value limits (commonly 80%), so the equity you can actually extract is value × 80% minus your payoff balance. The calculator takes the cash figure you enter; check it against that cap before relying on the result.
Questions
- Does a cash-out refinance raise my payment a lot?
- Often surprisingly little — $40,000 added to the example loan moved the payment by under $15 because the term reset to 30 years. The cost shows up in lifetime interest instead: $40,097.97 over staying put.
- Cash-out refinance or HELOC?
- If your current mortgage rate is below today's market, a HELOC usually wins because it leaves the cheap first mortgage alone. If your rate is above market, a cash-out can lower the payment and raise cash in one move. Run both before choosing.
More ways to use this calculator
Start with the main refinance calculator or compare the other published scenarios.
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