Three ways to use equity. The cheapest depends on your current rate.
Cash-out refinance, home equity line of credit, or home equity loan. If your existing mortgage rate is low, replacing it to pull cash can cost far more than a second lien. If it’s high, one new loan can be the better move. The comparison is the decision.
- Have meaningful equity and a specific use for it
- Want to compare keeping vs. replacing your current mortgage
- Are funding a renovation, consolidating debt, or buying another property
- Want to understand Florida’s closing costs on a new mortgage
Cash-out refinance vs. HELOC vs. home equity loan.
| Cash-out refinance | HELOC | Home equity loan | |
|---|---|---|---|
| What happens to your mortgage | Replaced with one larger loan | Stays; a second lien is added | Stays; a second lien is added |
| Rate type | Fixed (or ARM) on the whole balance | Variable, tied to prime; some offer fixed-rate locks on draws | Fixed |
| How you receive funds | Lump sum at closing | Draw as needed during a draw period (often 10 years), then repay | Lump sum at closing |
| Typical maximum | 80% of value conventional and FHA; VA up to 100% by rule, often 90% by lender | Often 80–90% combined loan-to-value | Often 80–90% combined loan-to-value |
| Closing costs | Full mortgage closing costs, including Florida doc stamps and intangible tax on the new loan | Lower; sometimes lender-paid with conditions | Moderate |
| Best when | Your current rate is at or above today’s, or you want one fixed payment | You want flexibility and may not need all the money at once | You want a fixed payment and a known payoff while keeping a low first-mortgage rate |
Florida levies documentary stamp tax on promissory notes (35 cents per $100) and a nonrecurring intangible tax on new mortgages (2 mills, or $2 per $1,000). confirm current rates On a $400,000 refinance that’s roughly $2,200 in state taxes before any other closing cost, which is why replacing a mortgage to access a modest sum is often the expensive route. Availability and exact terms through Jared’s lender to be confirmed before launch. Second-lien products may be offered through Jared’s lender or a partner. confirm
Why the current rate decides it, with made-up numbers
A homeowner owes $300,000 at 3.25% and wants $60,000 for a roof and impact windows. A cash-out refinance to $360,000 at a hypothetical 6.75% raises the rate on the entire $300,000 they already owe. The extra interest on the existing balance alone dwarfs the cost of a second lien at a higher rate on just $60,000.
Reverse the facts: a homeowner at 7.5% with the same need might do better with one new loan, since the refinance lowers the rate on the whole balance while adding the cash. Jared runs both, including Florida taxes and the break-even, before recommending either.
What people fund, and the honest caveats.
Roof, windows, and electrical often reduce insurance premiums; a renovation loan is the alternative when equity is thin.
Moving card debt onto your house lowers the rate but turns unsecured debt into secured debt and often stretches it over decades. Worth doing with a plan; risky without one.
Common for investors and second-home buyers. The new payment must fit your ratios for the next purchase; see investment property.
Reasonable uses; compare against purpose-specific financing and consider how a variable HELOC rate behaves over years.
For homeowners 62+, a different product with different rules. Whether Jared offers HECM loans to be confirmed; otherwise this line is removed.
Funding consumption you’ll repay for 30 years, or borrowing to a loan-to-value that leaves no cushion for a soft market.
How much equity can I access?
Is a HELOC interest-only?
Will this affect my current mortgage rate?
How long does it take?
Is the interest deductible?
Tell Jared your current rate, balance, and what you want to fund.
He’ll compare all three routes with Florida costs included.
- No credit pull, no obligation
- Not an application; no guarantee of approval or terms
- Rather talk? Call or text 954-649-0020
Your equity is yours. Use it on purpose.
Jared can show you the cost of each path before you choose.