Cash Out Refinance Investment Property Loans

Investors seeking to maximize the value of their real estate portfolios often turn to cash-out refinancing as a powerful financial strategy. By leveraging the equity in their properties, investors can secure additional funds for house renovations, new acquisitions, or even debt consolidation solutions. But with so many mortgage lenders and loan options available, how do you determine which cash-out refinance loan best suits your investment property strategy?

Top 5 Cash-Out Refinance Loans for Investment Properties in 2025

The RefiGuide has been working with the trusted banks and lenders many years that offer competitive cash out refinancing on investment and rental properties.

Let’s explore the top five cash-out refinance loans for investment properties in 2025 and see how they can propel your financial growth.

1. Fannie Mae’s Cash-Out Refinance Loan

Fannie Mae’s cash-out refinance program is a go-to option for many real estate investors due to its favorable terms and accessibility.

Key Benefits:

• Competitive interest rates for qualified borrowers
• Loan-to-value (LTV) ratios up to 75% for single-unit investment properties
• Fixed and adjustable-rate mortgage options
• Extended loan terms to help reduce monthly payments

Why settle for a high-interest loan when you can secure financing backed by one of the largest mortgage institutions in the country? With Fannie Mae, you gain stability and flexibility to expand your portfolio strategically.

2. Freddie Mac Investment Property Cash-Out Refinance

Freddie Mac offers a similar yet distinct refinance program tailored to real estate investors looking for favorable loan structures.

Key Benefits:

• Maximum LTV of 70-75% depending on property type
• Competitive interest rates to enhance cash flow
• Allows for refinancing multiple properties at once
• Offers fixed-rate and adjustable-rate loan structures

Whether you’re refinancing a single-family home or a multi-unit property, Freddie Mac’s program provides the leverage needed to boost your investment potential.

3. Portfolio Loans 

For investors who don’t meet traditional lending criteria or prefer more flexible financing solutions, portfolio loans from private lenders can be a game-changer.

Key Benefits:

• No strict credit score requirements
• Higher LTV ratios, sometimes up to 80%
• More lenient income verification standards
• Faster approval and funding process

Why jump through hoops with conventional lenders when private lenders offer the flexibility and speed investors need? With fewer restrictions and customized loan structures, portfolio loans cater to investors seeking rapid capital deployment.

4. DSCR Loans

Debt-Service Coverage Ratio loans are specifically designed for real estate investors whose income primarily comes from rental properties. Instead of using traditional income verification, these loans focus on a property’s cash flow to determine loan eligibility.

Key Benefits:

• No personal income verification required
• Loan approvals based on rental income rather than W-2 income
• LTV ratios of up to 75-80%
• Ideal for investors with multiple rental properties

If your rental properties generate steady income, why let traditional income limitations hold you back? DSCR cash out refinances ensure that your assets, not just your tax returns, dictate your borrowing potential.

5. HELOC on Investment Property

A HELOC is an alternative to traditional cash-out refinancing that allows investors to access property equity on an as-needed basis. Instead of receiving a lump sum, you get a revolving line of credit to withdraw from whenever necessary.

Key Benefits:

• Flexible access to capital
• Interest-only payments during the draw period
• Competitive variable interest rates
• Retains your primary mortgage structure

Why take out more cash than you need when a HELOC allows you to draw funds when necessary, minimizing interest costs and maximizing liquidity? This solution is perfect for investors seeking on-demand financial flexibility.

Cash-out refinance loans are a powerful way for investors to unlock their property’s equity and fuel their real estate ambitions. Whether you choose Fannie Mae, Freddie Mac, private portfolio loans, DSCR cash out loans, or a HELOC, each option offers unique advantages suited to different investment strategies.

So, which cash out refi will you choose to grow your portfolio in 2025? The answer lies in aligning your financial goals with the loan that best meets your needs.

Smart investing is about leveraging opportunities, and a well-planned cash-out refinance can be your key to exponential real estate growth.

12 Key Benefits of Cash-Out Refinance Investment Property Loans

Investing in real estate can be a powerful way to build wealth, but unlocking liquidity within your property can be a challenge. This is where a cash-out refinance on investment property loans comes in—a financial tool that allows investors to leverage their property’s equity for greater financial gains. But why should you consider this strategy? What makes it a game-changer for investors looking to scale their real estate portfolios? Let’s explore the 12 key benefits of cash-out refinance investment property loans and see how they can work in your favor.

1. Access to Capital for Further Investments

One of the most significant advantages of cash-out refinancing is the ability to tap into your home’s built-up equity. Instead of letting that wealth sit idle, you can reinvest it into additional properties, thereby compounding your returns and expanding your real estate holdings.

2. Lower Interest Rates Compared to Other Financing Options

Compared to personal loans, credit cards, or even hard money loans, cash-out refinances often come with lower interest rates. Why pay exorbitant rates on unsecured loans when you can leverage your existing asset for better terms?

3. Increased Cash Flow for Renovations

Whether you want to upgrade a rental property or add value through renovations, using cash-out refinance proceeds can be a strategic move. Enhancing a property’s appeal can lead to higher rental income, increased market value, and a more competitive edge in the rental market.

4. Debt Consolidation and Improved Financial Health

If you have multiple high-interest debts, a cash-out refinance can help you consolidate them into one manageable loan with a lower rate. This can reduce your overall financial burden and improve your credit score over time as you eliminate outstanding obligations.

5. Tax Advantages for Real Estate Investors

In many cases, interest paid on loans used for investment purposes may be tax-deductible. This means you could potentially deduct the interest on a cash-out refinance loan, reducing your taxable income and increasing your after-tax profits.

6. Flexible Use of Funds

Unlike some financing options that come with restrictions on how the money can be used, cash-out refinance loans allow investors to use the funds as they see fit. Whether it’s for expanding your portfolio, covering operating costs, or handling unexpected expenses, the choice is yours.

7. Opportunity to Secure a More Favorable Loan Term

Refinancing doesn’t just provide cash—it also gives you the chance to secure better loan terms, such as a lower interest rate, a fixed-rate mortgage instead of an adjustable-rate, or a different loan duration that better fits your financial goals.

8. Potential for Increased Property Value

Reinvesting the extracted cash into renovations and upgrades can significantly increase a property’s value, allowing you to build even more equity over time. This can be particularly beneficial in competitive real estate markets.

9. Hedge Against Inflation

As inflation rises, the real value of borrowed money decreases. A cash-out refinance allows you to capitalize on today’s lower-value dollars while acquiring more appreciating assets in a rising market.

10. Avoiding the Hassle of Selling

Selling a property comes with costs, taxes, and the challenge of reinvesting profits into another property quickly. Instead, a cash-out refinance lets you retain ownership while still accessing equity, maintaining your portfolio and avoiding capital gains tax implications.

11. Stronger Position in a Competitive Market

Real estate investors often need to act fast to seize profitable deals. With liquidity readily available from a cash-out refinance, you can move quickly on opportunities that require immediate funding, giving you an edge over competitors who need traditional financing.

12. Long-Term Wealth Building Strategy

Ultimately, real estate is about long-term growth, and a cash-out refinance supports this strategy by enabling portfolio expansion, increasing cash flow, and boosting investment returns over time. By leveraging existing assets wisely, investors can create sustainable wealth.

Top 8 Ranked Lenders for Cash-Out Refinancing on Investment Properties in 2025

In 2025, with investment property values up 6% year-over-year and cash-out refinance rates averaging 7.5-8.5% amid stabilizing Fed policies, unlocking equity from rentals has never been more strategic. Cash-out refis allow investors to pull up to 75% LTV for expansions, debt consolidation, or rehabs, but options are limited to Non-QM and specialty lenders due to higher risk. Drawing from HMDA data, J.D. Power rankings, and borrower reviews on platforms like Trustpilot and BiggerPockets, we’ve ranked the top 8 lenders specializing in investment property cash-outs. Criteria include rates, LTV max (typically 70-80%), closing speed (30-45 days), and investor satisfaction. These standouts offer DSCR-based approvals, flexible terms up to 30 years, and jumbo options to $3M+.

8. CoreVest Finance

CoreVest tops for institutional investors, offering up to 80% LTV on cash-outs for 1-4 unit rentals with DSCR as low as 1.0. Rates start at 7.75%, with no personal income verification—ideal for portfolio scaling. A 2025 NerdWallet review praises its $1B+ annual volume and 4.5/5 investor ratings for seamless multifamily refis. Drawback: Minimum $100K loan.

7. Kiavi

Kiavi excels in bridge-style cash-outs, funding up to 75% LTV in 10-15 days for fix-and-flip investors. At 8.25% rates, it skips appraisals on seasoned properties, per Forbes’ 2025 list. BiggerPockets users rate it 4.7/5 for quick equity access on rehabs, though fees hit 2-3 points. Best for short-term holds.

6. American Heritage Lending

This lender shines for DSCR cash-outs on non-owner-occupied homes, with 75% LTV and rates from 7.9%. It supports up to 10-unit properties, closing in 30 days without tax returns. Bankrate’s 2025 rankings highlight its 4.6/5 satisfaction for investor-friendly terms, including interest-only options. Minor con: Higher reserves required (6 months).

5. West Capital Lending

West Capital Lending secures #5 for its personalized Non-QM cash-outs tailored to investors, offering 70-75% LTV at competitive 7.8% rates on 1-4 unit rentals. Specializing in bank statement and DSCR loans, it closes in 25-35 days with minimal docs. With a stellar 4.8/5 rating on Trustindex from 2,252 reviews, borrowers rave about loan officers like Brian Ramos for beating 14 competitors and funding in four days. Yelp’s 141 five-star testimonials praise smooth rental property refinances. West Cap is ideal for self-employed investors.

4. LoanDepot

Defy ranks high for innovative DSCR cash-outs up to 80% LTV on short-term rentals, with rates at 7.6% and no appraisal on low-risk deals. In 2025, LoanDepot ranked well on Zillow for flexible terms up to $2 million jumbo loans. Investors appreciate the 20-day closings, per U.S. News reviews, but jumbo fees apply.

3. PNC Bank

PNC stands out for conventional cash-outs on investment properties, allowing 75% LTV at 7.5% rates without owner-occupancy limits. Money.com’s top pick for 2025, it scores 4.5/5 in J.D. Power for online tools and custom quotes. Strong for multifamily, though DTI caps at 45%.

2. Rocket Mortgage

As the volume leader, Rocket offers up to 80% LTV cash-outs for rentals at 7.4% rates, with digital apps closing in 21 days. NerdWallet and Bankrate rank it #1 for convenience, with 4.6/5 ratings from 1M+ reviews. Its investor program skips income docs for DSCR ≥1.25—perfect for scaling.

1. Vaster

Vaster claims the top spot for agile private cash-outs, funding 75-80% LTV at 7.2% rates in 15-20 days for seasoned rentals. Its 2025 blog highlights 4.8/5 satisfaction for bypassing traditional hurdles, per investor forums. Excels in high-LTV deals up to $5M, with minimal reserves.

These lenders empower 2025 investors to leverage $10T in rental equity wisely. Compare via HMDA tools, and consult advisors—rates vary by credit (680+ ideal) and location. With closings accelerating via AI underwriting, now’s prime time to refi.

Final Thoughts on Cash Out Refinancing on Investment Properties

A cash-out refinance investment property loan is not just a financial tool—it’s a strategic advantage that can propel investors toward their long-term real estate goals. Why let equity sit dormant when it can be working for you? With the right approach, this financing strategy can unlock new opportunities, enhance cash flow, and accelerate wealth creation.

If you’re considering a cash-out refinance, carefully evaluate your financial position, market conditions, and investment goals to ensure it aligns with your broader wealth-building strategy. Because in real estate, the smartest investors aren’t just buying properties—they’re maximizing their potential.

FAQ on Investment Property Cash Out Refinances

How much equity do you need for a cash-out refinance on an investment property?

Most lenders require at least 25-30% equity in the property to qualify for a cash-out refinance. This means your loan-to-value (LTV) ratio should typically be 70-75% or lower after the refinance. The exact amount depends on the lender and your financial profile, but maintaining sufficient equity ensures you qualify for competitive rates and better loan terms.

What DTI do you need for a cash-out refinance on an investment property?

Lenders usually require a debt-to-income (DTI) ratio of 43% or lower for a cash-out refinance on an investment property. However, some lenders allow higher DTIs, especially if you have strong credit and a history of profitable real estate investments. The lower your DTI, the better your chances of securing favorable loan terms.

What refinance costs are tax-deductible for rental property?

For rental properties, certain refinance costs may be tax-deductible, including loan interest, origination fees, and points paid to lower the interest rate. However, closing costs, such as appraisal and title fees, are generally not deductible upfront but may be amortized over the life of the loan. Always consult a tax professional to maximize your deductions and ensure compliance with IRS regulations.

Which banks provide cash out refinance on investment property?

Several national and regional banks offer cash-out refinancing on investment properties, including Wells Fargo, Chase, Bank of America, and specialized lenders like West Capital Lending. Many credit unions and community banks also provide competitive options. Availability depends on your credit profile, loan-to-value ratio, and reserve funds. Since investment properties are considered riskier, expect higher rates and stricter underwriting. Comparing multiple investment property cash out lenders is the best way to secure favorable terms for your investment strategy.

Can I do a DSCR cash out refinance on investment property?

Yes, many non-QM lenders offer DSCR cash-out refinances on investment properties. These loans focus on the rental income the property generates rather than traditional income documentation. Investors use DSCR cash-out refinancing to unlock equity for additional purchases, renovations, or portfolio expansion. Qualification usually requires a DSCR of 1.0 or higher, meaning rental income covers the mortgage. While rates may be slightly higher, DSCR programs provide flexible access to investment capital.

Do non-QM lenders offer cash out refinancing on rental properties?

Yes, non-QM lenders often specialize in cash-out refinancing for rental properties. Unlike traditional lenders, they may allow alternative income verification, such as bank statements or asset depletion, and accept higher loan-to-value ratios. Non-QM loans are popular among self-employed investors or those with complex financial profiles. Although interest rates are usually higher than conventional loans, they provide flexible financing options for borrowers who don’t fit strict agency guidelines but want to tap property equity.

Can I get an FHA cash out refinance on an investment property?

No, FHA cash-out refinancing is not available for investment properties. FHA programs are designed exclusively for primary residences where the borrower lives full time. Investors seeking to tap equity must use conventional, jumbo, or non-QM cash-out refinance options. If you own rental properties, lenders will typically limit loan-to-value to 70–75% and require stronger credit. Exploring DSCR or non-QM programs may be more suitable for investment-focused refinancing strategies.

Should I cash out my 401k to buy rental property?

Cashing out a 401k to buy a rental property is generally discouraged. Withdrawals before age 59½ may trigger income taxes and a 10% early withdrawal penalty, drastically reducing your available funds. Even without penalties, removing retirement savings reduces long-term compound growth. While real estate can generate returns, leveraging home equity loans, HELOCs, or DSCR financing is typically safer. It’s wise to consult both a financial planner and tax advisor before tapping retirement accounts for investment purposes.

Is a cash out refinance better than a HELOC on an investment property?

It depends on your goals. A cash-out refinance provides a lump sum with long-term fixed repayment, ideal for consolidating debt or funding major projects. However, it often carries higher closing costs and stricter underwriting. An investment property HELOC offers flexible, revolving credit for ongoing expenses, but typically comes with variable interest rates and lower LTV limits. Investors seeking stability may prefer cash-out refinancing, while those valuing flexibility often lean toward HELOCs. Comparing both options is crucial.

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