VA Cash-Out Refinance: Requirements & Limits

If you're a veteran, active-duty service member, or eligible surviving spouse, the VA cash-out refinance is one of the most powerful loan programs available. It allows you to tap into your home equity—often more than any other loan type—while benefiting from competitive rates and no private mortgage insurance (PMI).

Whether you want to consolidate debt, renovate your home, lower your interest rate, or even refinance a non-VA mortgage into a VA loan, the VA cash-out program gives you unmatched flexibility.

This guide explains everything you need to know about VA cash-out refinance requirements, LTV limits, eligibility rules, benefits, downsides, and how to get the best pricing.

Key Takeaways

✅ VA cash-out refinances allow you to access equity—often up to 90% LTV or higher (rare), depending on the lender.

✅ You can use the cash for any legal purpose: renovations, debt payoff, education, investment, or another home’s down payment.

✅ VA cash-out also allows eligible non-VA borrowers to refinance into a VA loan.

✅ Full underwriting, appraisal, and income verification are required.

💡Pro tip: Use Fincast to compare your loan options. Simply upload your Loan Estimate and the platform lets vetted lenders view your information anonymously to determine if they can offer a better deal.

What Is a VA Cash-Out Refinance?

A VA cash-out refinance lets eligible borrowers replace their current mortgage with a new, larger VA loan—and take the difference in cash.

You can use this to:

• Tap home equity

• Refinance from FHA, USDA, or conventional into VA (if you have VA eligibility)

• Pay off debt

• Finance renovations

• Cover medical, education, or business expenses

• Buy another property

There typically are not any restrictions on how you use the funds, but this may vary by lender.

Who Is Eligible for a VA Cash-Out Refinance?

You’re eligible if you’re:

• A veteran

• An active-duty service member

• A qualified National Guard or Reserve member

• An eligible surviving spouse

You’ll need a Certificate of Eligibility (COE)—your lender can automatically retrieve it for you, or you can request it yourself.

VA Cash-Out Refinance Requirements (2026)

VA cash-out refinances are more involved than VA IRRRL (streamline) refinances, because they allow cash access and can be used to refinance non-VA loans.

Here's what you'll need:

1. Certificate of Eligibility (COE)

This document shows that your VA entitlement is available and, if applicable, how much. If you’ve used your VA benefits before, you may have less entitlement than someone who has never used their benefits. Your lender can help you determine the amount.

2. Credit Requirements

The VA sets no official minimum, but lenders typically require:

• 620+ minimum credit score

• 680–740+ for best pricing

The requirements vary by lender, so it’s important to shop around and find the lender offering the most attractive deal for your situation. You can either shop around manually or upload your Loan Estimate to Fincast for a faster, automated process to find the right loan.

3. Income & Employment Verification

This refinance requires:

• W-2s

• Pay stubs

• Tax returns (if self-employed)

• Employment verification

You must show stable, reliable income. The exact requirements may vary by lender. For example, some lenders may require a longer employment length than others, or some may have stricter requirements for self-employed borrowers.

4. Debt-to-Income Ratio (DTI)

The VA doesn’t focus on debt-to-income ratios, but it’s still important to keep yours within a reasonable range. The VA’s main focus is on residual income, which is the funds left each month after paying your bills. The amount required varies based on your geographic region, family size, and loan amount.

While the VA doesn’t focus on DTI, many lenders prefer:

• DTI ≤ 50%

• Strong residual income (VA requirement)

The actual requirements will vary by lender, so shop around to find one that accepts your DTI and offers affordable terms.

5. Appraisal Required

Unlike VA IRRRLs, cash-out refinances do require an appraisal.

Your home’s value determines your borrowing limit.

6. Property Must Be a Primary Residence

You must certify that the property is your primary home.

You cannot use VA cash-out refinancing for:

• Investment properties

• Second homes

7. Loan Seasoning Requirements

To refinance a loan you currently have:

• 210 days must have passed since your last mortgage closed

• 6 monthly payments must have been made

• Note: Exact requirements vary by lender and market conditions.

VA Cash-Out Refinance LTV Limits (2026)

This is where VA loans shine.

Many lenders allow:

📌 Up to 90% LTV

Some lenders allow:

📌 Up to 100% LTV (rare)

• The exact requirements vary by lender. Always consult with your lender to determine what they allow.

VA cash-out LTV requirements are typically more flexible than:

• Conventional cash-out loans: max 80% LTV

• FHA cash-out loans: max 80% LTV

• Jumbo cash-out loans: max 60–70% LTV (varies by lender)

What 90–100% LTV looks like:

Example:

• Home value: $500,000

• Lender allows 100% LTV: max loan = $500,000

• Current mortgage: $350,000

• Max cash-out ≈ $150,000

At 90% LTV:

• Max loan = $450,000

• Cash-out ≈ $100,000

Having access to this much equity makes the VA cash-out one of the most powerful home finance tools available.

What You Can Use VA Cash-Out Funds For

VA cash-out is completely flexible. You can use funds for:

✔ Debt consolidation

Pay off credit cards, personal loans, or auto loans.

✔ Renovations & upgrades

Modernize your home or complete repairs.

✔ Investment property down payment

Using VA cash-out funds to buy rentals.

✔ Education or medical expenses

Use cash without high-interest financing.

✔ Refinancing out of FHA (remove MIP)

Many borrowers use VA cash-out to eliminate FHA mortgage insurance.

✔ Refinance a conventional loan

Benefit from VA rates and no PMI.

✔ Business investment

Use equity to fund a business or startup.

• Some lenders may have overlays or requirements regarding how you can use the funds. Always check with your lender first.

VA Cash-Out vs. VA IRRRL (Streamline Refinance)

If you want cash, you must choose the VA cash-out refinance, not the IRRRL.

• The exact requirements for either type of VA loan vary by lender, as each lender can add their own overlays.

VA Funding Fee for Cash-Out Refinances (2026)

Unless exempt, borrowers pay a VA funding fee, which can be rolled into the loan.

Funding Fee Amounts:

• 2.15% — First-time VA use

• 3.3% — Subsequent use

Borrowers with a VA disability rating are exempt from the funding fee, but you must qualify for disability through the VA.

Pros & Cons of VA Cash-Out Refinance

✔ Pros

✔ Highest LTV limits of any major loan type

Access more equity than with FHA or conventional loans.

✔ No PMI — ever

Even with 90–100% LTV.

✔ Can refinance out of FHA or conventional

Remove MIP, PMI, or other restrictions.

✔ Flexible use of funds

No limitations on how you spend the cash.

✔ Competitive mortgage rates

VA pricing can be competitive, but it depends on the current market, the lender you choose, and your individual financial profile.

✘ Cons

✘ Requires full underwriting

More documentation vs. IRRRL.

✘ Appraisal required

Low appraisal may limit cash-out amount.

✘ Funding fee applies

2.15–3.3% unless exempt.

✘ Must be a primary residence

Cannot apply to investment properties.

✘ Rates may be priced higher at high LTV

Especially above 90%.

When VA Cash-Out Makes the Most Sense

It’s often the right choice when you want to:

✔ Consolidate high-interest debt

✔ Finance home improvements

✔ Buy another property

✔ Refinance out of FHA (remove mortgage insurance)

✔ Leverage high appreciation into liquidity

✔ Lower your rate while tapping equity

✔ Access a large sum ($50k–$200k+)

✔ Switch from a conventional loan to a VA if the terms are better

How Fincast Helps You Confidently Choose VA Cash-Out Terms 🚀

VA cash-out pricing varies more than almost any other loan type.

Why?

Because lenders handle high-LTV VA loans differently. This makes comparison shopping essential.

Fincast helps by:

1️⃣ Uploading your Loan Estimate (no extra credit pull)

2️⃣ Analyzing your rate, lender fees, funding fee, and LTV pricing

3️⃣ Allowing vetted VA lenders to review your information and make an offer

4️⃣ Showing which lender gives you the highest cash-out at the lowest cost

💡 Pro Tip: A slightly better rate can save you money each month and over the life of the loan, while increasing your total cash-out.

FAQs

1. How much cash can I get from a VA cash-out refinance?

Typically up to 90% LTV; some lenders allow 100%. The exact requirements vary by lender, so it’s best to shop around to find the best deal.

2. Is cash-out allowed if I currently have an FHA or conventional loan?

Yes — you can refinance any loan into a VA cash-out refinance if you are eligible for a VA loan.

3. Do I need an appraisal?

Yes, always. This is a VA rule and doesn’t vary by lender.

4. Do I need good credit?

Minimum lender standards are usually 620+, but every lender has their own requirements. Shop around for the right lender who will accept your situation.

5. Do I need to live in the home?

Yes — the home must be your primary residence.

Bottom Line

The VA cash-out refinance is a flexible financial tool available to eligible veterans. With generous LTV limits, no PMI, and competitive rates, it’s ideal for debt consolidation, renovations, investment, or simply improving your loan terms.

You’re in the strongest position when:

✅ You understand VA cash-out requirements and LTV limits

✅ You compare multiple lender offers

✅ You upload your Loan Estimate to Fincast to avoid overpaying

Pro Tips (Save These!)

💡 VA cash-out can refinance ANY loan type

📈 Some lenders still allow up to 100% LTV

📊 Debt consolidation often yields huge monthly savings

⚠ Always compare funding fees and lender fees

🚀 Use Fincast to benchmark your VA cash-out offer

Action Checklist

• Confirm VA eligibility

• Check your home value and max LTV

• Review potential cash-out uses

• Request a Loan Estimate

• Upload your Loan Estimate to Fincast

• Compare competing VA cash-out offers

• Close and access your equity with confidence

👉 Ready to see how much VA cash-out you qualify for?

Upload your Loan Estimate to Fincast — where you can compare offers from vetted lenders to determine whether you have the most competitive VA cash-out refinance terms.