Quick Comparison
Cash-Out Refinance
Replace existing mortgage
Lower Interest Rate
First mortgage rates
Fixed Payment
Predictable monthly cost
Tax Deductible
Interest may be deductible
Higher Closing Costs
$2,000-$5,000+
Lose Current Rate
New rate on full balance
HELOC
Second mortgage line of credit
Keep Current Rate
First mortgage unchanged
Lower Closing Costs
$0-$1,000
Flexible Access
Draw only what you need
Variable Rate
Payment can increase
Higher Rate
Second lien pricing
Frequently Asked Questions
Which option has lower interest rates?
Cash-out refinances typically have lower rates than HELOCs since they're first mortgages. HELOCs are second liens with higher rates.
Can I keep my current low rate?
With a HELOC, yes. With cash-out refinance, you'll get a new rate on the entire loan amount.
Which has lower closing costs?
HELOCs typically have lower closing costs ($0-$1,000) compared to refinances ($2,000-$5,000+).
How much can I borrow?
Both allow borrowing up to 80-90% of home value. Refinance replaces your current loan; HELOC is additional.
Cash-Out Refinance vs HELOC: Comparing Rates, Costs & Flexibility
Our experts can analyze your situation and recommend the best option.
Related Resources
Continue exploring these helpful resources related to your mortgage journey