Instead, you can consider a home equity line of credit (HELOC) or a home equity loan. These “second mortgages” allow you to withdraw the value of your home without refinancing your existing loan. You can withdraw your home equity in several ways. They include home equity loans, home equity lines of credit (HELOC), and cash-out refinances, each of which has benefits and drawbacks.
If you have at least 20 percent, the most common ways to take advantage of excess capital are through a cash-out refinance or a home equity loan. Cash-out refinance gives you a lump sum when you close your refinance loan. The proceeds from the loan are first used to pay off your existing mortgage (s), including closing costs and any prepaid items (e.g. real estate taxes or homeowners insurance); the remaining funds are yours to use as you wish.