Requirements: enough equity (rate-and-term allows higher LTV than cash-out), credit usually 620+, verifiable income, reasonable DTI, and an appraisal (sometimes waived on streamlines).
Why it’s easier than cash-out
Because you’re not pulling equity, a rate-and-term refinance permits higher LTV and often prices better than cash-out. You still re-verify income and credit, and usually appraise — unless a streamline waives it.
Program paths
Conventional, FHA streamline, and VA IRRRL all offer rate-and-term paths. Streamlines are built specifically to lower your rate quickly with minimal documentation.
| Requirement | Typical |
|---|---|
| Cash out | None |
| Max LTV | Higher than cash-out |
| Credit | ~620+ (streamlines flexible) |
| Appraisal | Usually; may be waived |
Frequently asked questions
How is this different from cash-out?
Rate-and-term takes no equity as cash, so it allows higher LTV and usually a better rate. Cash-out gives you money but caps near 80% LTV.
Can I roll costs in without it being "cash-out"?
Financing closing costs generally keeps it rate-and-term, within limits. We’ll confirm the thresholds.
Do I need an appraisal?
Often yes, but FHA and VA streamlines frequently waive it.
Save Financial is a California-licensed mortgage brokerage (NMLS #377740, DRE #01875766). Figures are illustrative for 2026 and not an offer of credit.