A cash-out refinance on an investment property replaces your existing mortgage with a new, larger loan — and you receive the difference in cash at closing. It's how experienced investors recycle equity from appreciated properties to fund new acquisitions without needing to sell the asset or bring new capital from outside the portfolio.
How Investment Property Cash-Out Refinancing Works
The mechanics are straightforward:
Establish current value
An appraisal determines your property's current market value. Appreciation since purchase creates the equity you'll access.
Calculate available equity
Most lenders allow you to cash out up to 75–80% of appraised value (LTV). Subtract your current loan balance to find available cash.
Apply for new loan
The new loan pays off the existing mortgage. Any remaining proceeds come to you in cash at closing.
Redeploy capital
Use proceeds to fund next acquisition, renovate existing properties, pay off high-rate debt, or hold in reserve.
Quick Example
Property purchased for $300,000. Current value: $420,000. Existing loan balance: $210,000. At 75% LTV, new loan = $315,000. Cash at closing = $315,000 − $210,000 − closing costs ≈ $90,000+ to redeploy.
DSCR Cash-Out vs Conventional Cash-Out
For investment properties, DSCR cash-out refinances are often the better option:
| Factor | Conventional Cash-Out | DSCR Cash-Out |
|---|---|---|
| Income docs required | Yes — W-2s, tax returns | No |
| Max LTV | 70–75% | 75–80% |
| Property limit | 10 financed max | No limit |
| LLC vesting | Not allowed | Allowed |
| Seasoning required | 6 months | 6 months |
| Self-employed friendly | Difficult | Yes |
Cash-Out Refinance Requirements
Requirements for investment property cash-out refinancing:
- Seasoning: 6 months minimum from purchase date or most recent cash-out
- Max LTV: 75–80% for DSCR programs, 70–75% for conventional
- Credit score: 620+ minimum, 680+ for best cash-out pricing
- DSCR: 1.0 minimum (rental income must cover new payment at higher loan amount)
- Property condition: Must be in rentable condition with no major deferred maintenance
- Occupancy: For DSCR cash-out, property must be actively rented or demonstrably rentable
When to Use a Cash-Out Refinance
Cash-out refinancing makes sense when:
- Your property has appreciated significantly and you want to access equity without selling
- You need capital for a new acquisition but don't want to bring in outside investors
- High-interest debt (credit cards, private money) can be consolidated into a lower-rate mortgage
- Renovation of existing properties will increase value and rental income
- You want to build cash reserves for future opportunities
Cash-Out Is Not Always the Right Move
Cash-out refinancing resets your amortization clock, increases your monthly payment, and may trigger a prepayment penalty on your existing loan. Always run the full numbers — not just the cash received. Our free cash-out calculator helps you see the complete picture before you apply.
Florida and Ohio Cash-Out Opportunities
Both Viador Partners markets present strong cash-out opportunities:
- Florida: Tampa Bay, Orlando, and South Florida properties have appreciated 40–80%+ since 2020 in many submarkets, creating substantial equity for investors who purchased pre-2022.
- Ohio: Columbus has seen consistent appreciation. Properties purchased in 2018–2021 often have 25–50% equity growth, providing meaningful cash-out potential at favorable LTV ratios.
Frequently Asked Questions
Most DSCR cash-out programs allow up to 75-80% LTV. To calculate your maximum cash-out: (Appraised Value × 0.75) − Current Loan Balance − Closing Costs = Available Cash. Our free calculator at viadorpartners.com/cashout-calculator can run this for you in seconds.
Most lenders require a 6-month seasoning period from purchase date before allowing a cash-out refinance. Some lenders require 12 months if the property was purchased below market value.
For DSCR cash-out refinances, no income verification is required. The qualification is based on the property's DSCR ratio at the new, higher loan amount. For conventional cash-out refinances, full income documentation is required.
Cash received from a refinance is generally not taxable because it is a loan, not income. However, the interest on the new, larger loan may be deductible depending on how proceeds are used. Consult your CPA for guidance specific to your situation.
Yes -- DSCR cash-out refinances can be done with the LLC as borrower. This is one of the significant advantages of DSCR over conventional for investors who hold properties in entities.
DSCR cash-out rates as of 2026 typically range from 7.0-8.5% for investment properties, varying based on LTV, DSCR ratio, credit score, and loan term.