Loan Comparison
Every refinance replaces your existing mortgage. What separates these two is whether you walk away with cash. A rate-and-term refinance changes only your rate or payoff schedule. A cash-out refinance increases the balance and hands you the difference. Lenders price them differently, so knowing which you are doing matters before you lock.
| Cash-Out Refinance | Rate-and-Term Refinance | |
|---|---|---|
| Cash at closing | Yes — equity converted to cash | No — balance stays roughly the same |
| Purpose | Debt consolidation, renovation, investment, reserves | Lower rate, shorter term, or drop mortgage insurance |
| Maximum loan-to-value | Typically up to 80% | Higher LTVs allowed |
| Rate pricing | Slight add-on for cash-out risk | Best available refinance pricing |
| Credit requirements | Somewhat stricter | More flexible |
| Effect on balance | Increases | Stays level or decreases |
| Best for | Homeowners who need funds and have equity | Homeowners who only want better terms |
If you only want a lower rate, a shorter term, or to remove mortgage insurance, take the rate-and-term — it prices better and qualifies easier. If you need capital, a cash-out refinance is often the cheapest money available to a homeowner, especially compared to credit cards or personal loans. If your current rate is well below market, compare against a HELOC before replacing it.
Still Deciding?
We'll price both programs with your actual numbers and show you the payment, cash to close, and long-term cost side by side — no credit pull required.
Questions
Usually slightly, because lenders add a pricing adjustment for cash-out transactions. The gap is typically small, and the blended cost still beats most consumer debt you would be paying off.
Rate-and-term refinances can work at higher loan-to-value ratios, and streamline options exist for FHA and VA loans. Cash-out generally requires keeping at least 20 percent equity in the home.
Yes, and it is one of the most valuable uses of a rate-and-term refinance. Moving from a 30-year to a 15-year loan often raises the payment modestly while cutting total interest dramatically.
About Us
CDL Mortgage Services Inc. is an independent, full-service mortgage company. Instead of pushing one bank’s products, we shop multiple wholesale lenders to secure the best loan at the best rate for every borrower.
Purchase, refinance, and home equity — all under one roof, focused on the best loans at the best rates.
Based at 6524 Lonetree Blvd, Rocklin, CA 95765 and licensed in California, Texas, Georgia, Tennessee, Oklahoma & Idaho.
Every file is handled start-to-finish by a licensed loan officer who knows your name and your goals.
Fully licensed and regulated, with award-winning lender partnerships and 35+ years serving borrowers.
Ready When You Are
One application, multiple wholesale lenders, and a licensed loan officer who explains the tradeoffs before you commit.