Cash Out

Business, Legal & Accounting Glossary

Definition: Cash Out

Cash Out

Full Definition of Cash Out

The term cash out applies to a type of mortgage refinancing where the property owner receives cash by taking on additional debt secured by accumulated equity in the real property, hence the phrase cash out. Low and falling mortgage interest rates encourage cash-out refinance, or refi mortgages. Falling rates make it worthwhile to replace an existing mortgage having a higher interest rate with one at a lower prevailing rate, whether including cash out or not. Low-interest rates support property appreciation, which increases the accumulation of owner equity necessary to support a cash-out transaction. As a category, cash-out mortgages have historically been a minority of refi volume even in the most favourable circumstances. As long as the borrower does not default, cash-out refinancing increases lender profits, because of the additional interest income generated by the increased principal balance. The home equity loan and home equity line of credit are alternatives to the cash-out refinance transaction.

Cite Term

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Page URL
Modern Language Association (MLA):
Cash Out. Payroll & Accounting Heaven Ltd.
January 17, 2022
Chicago Manual of Style (CMS):
Cash Out. Payroll & Accounting Heaven Ltd. (accessed: January 17, 2022).
American Psychological Association (APA):
Cash Out. Retrieved January 17, 2022
, from website:

Definition Sources

Definitions for Cash Out are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 4th February, 2020 | 4 Views.