Mortgage  Question?
Can You Do Cash-Out Refinance on a Rental Property?

Can you do a cash out refinance on a rental property?

Harry Jensen
, Trusted Mortgage Expert with 45+ Years of Experience

It is definitely possible to do a cash out refinance on a rental property but the qualification requirements are more restrictive and the mortgage terms are more expensive as compared to a standard refinance on a home you live in.

For a cash out refinance of a single unit rental property, lenders usually apply a maximum loan-to-value (LTV) ratio of 75%, which means you are required to have at least 25% equity in the property. For a two-to-four unit rental property, the maximum LTV ratio is typically 70%.

The lower the LTV ratio used by the lender, the less proceeds you can take out when you refinance. Depending on your existing more balance, the amount of money you take out may be limited by the lower LTV ratio.

Mortgage rates for a rental property cash out refinance are also higher. First, rental property rates tend to be 0.250% to 0.500% higher than the interest rate for the mortgage on your primary residence. Lenders also typically charge an additional premium for a cash out refinance which increases the rate even more.

The table below compares rental property mortgage rates and fees. There tends to be a wider variation in loan pricing for a rental property cash out refinance so we recommend that you contact multiple lenders to find the best mortgage terms.

Current Non-Owner Occupied Mortgage Rates in Ashburn, Virginia as of November 29, 2023
View All Lenders


Rate data provided by Displayed by ICB, a division of Mortgage Research Center, NMLS #1907, Equal Housing Opportunity. Payments do not include taxes or insurance premiums. Actual payments will be greater with taxes and insurance included. Rate and product details. Data provided by Icanbuy. Payments do not include amounts for taxes and insurance premiums. Read through our lender table disclaimer for more information on rates and product details.


"Standard Eligibility Requirements: Investment Property."  Eligibility Matrix.  Fannie Mae, October 2 2019.  Web.

« Return to Q&A Home
About the author
Harry Jensen, Mortgage Expert

Harry is the co-founder of FREEandCLEAR. He is a mortgage expert with over 45 years of industry experience. Over his career, Harry has closed thousands of loans for satisfied borrowers and now offers his advice and insights on FREEandCLEAR.  Harry is a licensed mortgage professional (NMLS #236752). More about Harry

Harry Jensen LinkedInLinkedIn | Email Harry JensenEmail