The VA cash-out refinance lets an eligible veteran or service member borrow against a DC home at up to 100% loan-to-value with no mortgage insurance. Conventional and FHA cash-out refinances stop at 80%.
VA cash-out rules compared with conventional and FHA
Loan-to-value limit: up to 100%
Conventional and FHA cash-out refinances cap at 80% LTV. VA permits up to 100% of value including the funding fee; some lenders cap at 90%. Example: on a $700,000 home with a $400,000 balance, that is roughly $230,000-$300,000 of equity before costs, versus about $160,000 with a conventional cash-out.
No private mortgage insurance
Conventional loans above 80% LTV carry PMI; VA loans never do, even at 100% LTV.
Pricing
See today's rates for VA pricing against conventional.
Credit score
The VA sets no minimum credit score. Each lender sets its own minimum, for example 620.
Who is eligible for a VA cash-out refinance
VA cash-out refinancing is available to:
- Veterans with an honorable discharge and sufficient service time
- Active-duty military with at least 90 days of service
- National Guard and Reserve members with 6+ years of service (or 90 days of active duty)
- Surviving spouses of veterans who died in service or from a service-connected disability
You'll need a Certificate of Eligibility (COE) from the VA. If you've used VA benefits before, you may have remaining entitlement, or full entitlement if your previous VA loan was paid off.
VA also requires seasoning (six payments made and 210 days past the first payment due date on the loan being refinanced), a documented net tangible benefit from one of VA's eight tests, a side-by-side comparison disclosure before closing, and that the home is your primary residence.
VA funding fee on a cash-out refinance
VA loans have no mortgage insurance but charge a one-time funding fee. For cash-out refinances:
| Usage | Funding Fee |
|---|---|
| First use | 2.15% of loan amount |
| Subsequent use | 3.3% of loan amount |
Exemptions: veterans receiving VA disability compensation are exempt from the funding fee, as are surviving spouses receiving DIC, Purple Heart recipients and the other categories listed on VA.gov. On a $500,000 loan the fee is $10,750 (first use) or $16,500 (subsequent use).
The funding fee can be added to the loan amount, so you do not pay it in cash at closing.
VA loan limits in DC
In 2026 there is no VA loan limit for borrowers with full entitlement, so a DC veteran can use a VA cash-out refinance on a home above DC's $1,249,125 conforming limit.
VA cash-out refinance and VA IRRRL compared
The VA has two refinance programs:
| Feature | VA Cash-Out | VA IRRRL |
|---|---|---|
| Take cash out | Yes | No (minimal) |
| Appraisal required | Yes | Not required by VA |
| Income verification | Yes | Not required by VA |
| Can refinance non-VA loan | Yes | No (VA-to-VA only) |
| Funding fee | 2.15-3.3% | 0.5% |
| Documentation | Full | Streamlined |
Use the IRRRL (Interest Rate Reduction Refinance Loan) to lower the rate on an existing VA loan with less paperwork and a lower funding fee. Use the VA cash-out to take cash or to refinance a non-VA loan into a VA loan.
Uses for VA cash-out funds
Preparing for a PCS move
Funds to prepare the home for rental or sale ahead of a permanent change of station.
Home renovation
Paying for repairs or upgrades to a DC home.
Paying off other debt
Paying off high-interest debt accumulated during deployment or transitions.
Education
Supplementing GI Bill benefits with home equity for graduate programs at Georgetown, George Washington, or other DC institutions.
Other uses
For any use, the cash becomes debt secured by your home. Review the considerations below first.
Steps in a VA cash-out refinance
- Get your COE: through VA.gov, through a VA lender, or by mail
- Apply: ask the lender its maximum LTV; some cap at 90%
- Home appraisal: required for cash-out; the home must meet VA minimum property requirements
- Underwriting: income, employment, credit and debt verification
- Closing: on a standard refinance timeline
Before you take cash out
- Your mortgage balance goes up: have a plan for the cash
- At 100% LTV you have no equity: if home values drop, you owe more than the home is worth
- The funding fee adds to your loan: count the fee in your break-even calculation
- Occupancy requirement: the home must be your primary residence (you may rent it out if you PCS later)
Read the DC cash-out refinance guide or request a free refinance analysis. It takes two minutes and does not pull your credit.
