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Cash-out refinance loan

A VA-backed cash-out refinance loan lets you replace your current loan with a new one under different terms. If you want to take cash out of your home equity or refinance a non-VA loan into a VA-backed loan, a VA-backed cash-out refinance loan may be right for you. Find out if you’re eligible—and how to apply for your Certificate of Eligibility.

Am I eligible for a VA-backed cash-out refinance loan?

You may be eligible for this type of loan if you meet all of the requirements listed below.

All of these must be true. You:

  • Qualify for a VA-backed home loan Certificate of Eligibility, and
  • Meet VA’s—and your lender’s—standards for credit, income, and any other requirements, and
  • Will live in the home you’re refinancing with the loan

Find out if you qualify for a VA-backed home loan Certificate of Eligibility (COE)

Why might I want to get a VA-backed cash-out refinance loan?

A VA-backed cash-out refinance loan may help you to:

  • Take cash out of your home equity to pay off debt, pay for school, make home improvements, or take care of other needs, or
  • Refinance a non-VA loan into a VA-backed loan

On a no-down-payment loan, you can borrow up to the Fannie Mae/Freddie Mac conforming loan limit in most areas—and more in some high-cost counties. You can borrow more than this amount if you want to make a down payment.
Learn more about VA home loan limits

You’ll want to keep closing costs in mind when refinancing a loan, as they can add up to thousands of dollars. Make sure you understand how your new loan amount relates to the value of your home. While your lender can advise you on the costs and benefits of the transaction, you’ll want to be sure you understand what you’re getting into.
Learn about the VA funding fee and other closing costs
Visit the Consumer Financial Protection Bureau for more information
Download the Bureau’s home loan toolkit (PDF)

How can I get a VA-backed cash-out refinance loan?

  1. Find a lender.

    You’ll go through a private bank, mortgage company, or credit union—not directly through us—to get a cash-out refinance loan. Terms and fees may vary, so contact several lenders to check out your options.

    Note: Be careful when considering home loan refinance offers. Claims that you can skip payments or get very low interest rates or other terms that sound too good to be true may be signs of a misleading offer.
    Learn more about the signs of misleading refinance offers

  2. Apply for your Certificate of Eligibility (COE).

    You’ll need to show your COE to your lender as proof that you qualify for the home loan benefit.
    Find out if you qualify for a COE
    Apply for your COE now

  3. Give your lender any needed information.

    In addition to your COE, you’ll need to give your lender:

    • Copies of paycheck stubs for the most recent 30-day period
    • W-2 forms for the previous 2 years
    • A copy of your federal income tax returns for the previous 2 years (required by many, but not all lenders)
    • Any other information your lender requires

    Note: The lender will order a home appraisal, an expert assessment of the value of your home.

  4. Follow your lender’s process for closing on the loan, and pay your closing costs.

    You may need to pay a VA funding fee at closing. This one-time fee helps to lower the cost of the loan for U.S. taxpayers since the VA home loan program doesn’t require down payments or monthly mortgage insurance. Your lender will also charge interest on the loan in addition to closing fees.
    Learn about the VA funding fee and other closing costs

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