How to get equity out of your home without refinancing and keep your low rate
You can get equity out of your home without refinancing by adding a second loan behind your current mortgage: a home equity line of credit (HELOC) or a home equity loan. Your first mortgage, its low rate and its payment stay exactly as they are. A third route, a home equity investment, pays cash now in exchange for a share of your home’s future value, with no monthly payment but often a high long-run cost.
This matters most if you locked a rate around 3% and today’s 30-year average is 7.40% (Freddie Mac, week of October 15, 2026). Below is how each option works, what it costs, and a worked example of keeping a 3% mortgage versus a cash-out refinance. When you know what you need, LenderMatch lets you describe it once and compare what lenders offer.
The three ways, in one line each
HELOC: a credit line you draw from as needed, usually at a variable rate.
Home equity loan: one lump sum, usually at a fixed rate.
Home equity investment: cash now, one lump-sum settlement later tied to your home’s value.
Why not just do a cash-out refinance?
A cash-out refinance pays off your current mortgage and replaces it with a bigger one. You get the difference in cash, but your whole balance moves to the new rate. If you owe $240,000 at 3.00% and take $50,000 out, all $290,000 now carries today’s rate, not just the new $50,000.
A second mortgage leaves the first one alone. The CFPB notes that second mortgages often carry higher rates than first mortgages, but you pay that rate only on the new money. For the full side-by-side, see cash-out refinance vs HELOC.
Option 1: a HELOC (tap equity as you need it)
A home equity line of credit is an open-end loan: the CFPB says you can borrow up to a set limit, repay, and borrow again. During the draw period (the CFPB gives 10 years as an example) you can borrow as needed. In the repayment period that follows, you can no longer borrow, and monthly payments are often significantly higher.
HELOCs usually have a variable rate, so payments may change month to month (CFPB). Many are priced as an index, commonly the prime rate (7.00% as of October 20, 2026, per the Federal Reserve), plus a margin the lender sets.
A HELOC tends to fit when costs arrive in stages, such as a renovation paid in phases, because you pay interest only on what you draw. See how a HELOC works and the HELOC payment calculator.
Option 2: a home equity loan (one lump sum, fixed rate)
A home equity loan is a closed-end second mortgage. The CFPB says you receive the money as a lump sum, and the loan usually has a fixed interest rate that will not change. You cannot borrow again from the same loan.
A home equity loan tends to fit when you need one known amount now and want a payment that will not move. The trade-off: you pay interest on the full amount from day one.
Option 3: home equity investments and sharing agreements
Home equity investments, also sold as home equity or shared equity agreements, are what the CFPB calls home equity contracts. In its January 15, 2025 report, the CFPB explains that a company gives you an upfront payment, and you later repay a single lump sum based, in part, on your home’s value. There is no monthly payment. Repayment is due at the end of the term, often 10 to 30 years, or when you sell. The cost comes from several features:
- A share of your home’s value or appreciation. The more your home rises in value, the more you repay.
- Multipliers. Some companies require a multiple of their initial payment.
- Discounted starting values. Some set your home’s starting value below its appraised value, which increases the company’s share.
- Rate caps. Several companies cap what they can collect at around 18% to 20% a year, compounded monthly.
- Fees. Processing fees are often 3% to 5% of the initial payment.
In the CFPB’s examples, the consumer pays the equivalent of 20% interest every year for the first two to six years, depending on the scenario. Against a mainstream $50,000 HELOC at 9%, it found the contract would be more expensive overall if the home appreciates. The CFPB also warns that homeowners who cannot pay the settlement at the end of the term risk having to sell their home or face foreclosure.
They may fit when you cannot qualify for a loan or carry a monthly payment, and you accept that the final amount is hard to predict.
Keep a 3% mortgage or do a cash-out refinance? A worked example
Say your home is worth $400,000. You owe $240,000 on a 3.00% mortgage with 24 years left, and your principal and interest payment is about $1,170 a month. You need $50,000.
- Cash-out refinance: a new 30-year, $290,000 loan at 7.40% (Freddie Mac average, week of October 15, 2026). Freddie Mac says refinancing typically costs 3% to 6% of the loan principal: $8,700 to $17,400 here.
- Second mortgage: keep the 3% loan and add $50,000 at an assumed 8.00% (the 7.00% prime rate plus a 1.00% margin, for illustration). The HELOC rows assume interest-only draw payments or a 20-year payoff; the home equity loan is fixed for 15 years.
| Path | Per month | vs cash-out |
|---|---|---|
| Cash-out refi, 7.40% | $2,008 | – |
| 3% loan + HELOC, interest only | $1,503 | $505 less |
| 3% loan + HELOC, 20-yr repayment | $1,588 | $420 less |
| 3% loan + home equity loan, 15 yr | $1,648 | $360 less |
Your blended rate on all $290,000 of debt would be about 3.86% with the second-mortgage paths, versus 7.40% after the refinance. In the first year, that is roughly $11,200 of interest instead of $21,460. To make the refinance cheaper on interest alone, the rate on the $50,000 would have to reach about 28.5%.
Principal and interest only, calculated by LenderMatch; excludes taxes, insurance and closing costs on the second mortgage. The 8.00% rate is an assumption for illustration, not a quote. Run your own numbers in the refinance calculator and the HELOC payment calculator.
The math flips when your current rate is close to today’s. In this example the crossover is a first-mortgage rate of about 7.3%: above it, one 7.40% loan costs less in interest than keeping the old loan plus an 8.00% line (before closing costs), and a cash-out refinance gives you the cash in one loan.
How much equity can you access without refinancing?
Lenders cap the total of all loans on your home at a percentage of its value, commonly 80% to 85%, then subtract what you owe. In the example above, an 80% cap allows up to $80,000 ($400,000 × 80% = $320,000, minus $240,000) and 85% allows up to $100,000. The lender’s appraisal sets the value it uses. See how much equity you can borrow for the full formula, or enter your numbers in the home equity calculator.
If your home is in Texas, state law caps all home equity borrowing at 80% of value and adds a 12-day waiting period; our Texas HELOC guide covers the rules.
Which way to tap your equity fits you?
- Your rate is well below 7.40% and you need money in stages: a HELOC.
- Your rate is well below 7.40% and you want one fixed payment: a home equity loan.
- You cannot qualify for a loan or carry a payment: read every term of a home equity investment (multiplier, cap, starting value) and ask what you would owe if your home rises 5% a year.
- Your rate is near or above today’s: a cash-out refinance deserves a look. See when refinancing makes sense.
What to watch out for
- Your home is the collateral. If you cannot repay a HELOC or home equity loan, you could lose your home.
- HELOC payments can rise with the rate, and again when the draw period ends.
- Lines can be frozen. The CFPB says a lender might stop new draws if your home’s value falls significantly or your finances change.
- Offers differ. Margins and fees vary by lender, so compare more than one. See does rate shopping hurt your credit.
Frequently asked questions
Can you get equity out of your house without refinancing?
Yes. A HELOC or a home equity loan lets you borrow against your equity while your first mortgage, its rate and its payment stay as they are. Both are second mortgages that sit behind the loan you already have.
Can I keep my low mortgage rate and still get cash?
Yes, with a HELOC or home equity loan. A cash-out refinance cannot do this, because it pays off your current mortgage and replaces it with a new, larger loan at today’s rate (the 30-year average was 7.40% for the week of October 15, 2026, per Freddie Mac).
Is a HELOC or a home equity loan better if I want to keep my rate?
Both keep your first mortgage rate. A HELOC usually has a variable rate and suits costs that arrive in stages. A home equity loan usually has a fixed rate and one lump sum, so it suits one known expense.
How do I get equity out of my home without monthly payments?
Two products work that way. A home equity investment (the CFPB calls it a home equity contract) pays cash now and is settled in one lump sum later, based partly on your home’s value. A reverse mortgage, only for homeowners 62 and older, has no monthly mortgage payment, but the CFPB says you must still pay property taxes and homeowners insurance, and the loan is repaid when you no longer live in the home.
Does LenderMatch check my credit?
No. LenderMatch never pulls your credit. A lender you choose may check it, with your permission, when you apply.
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Sources
- Freddie Mac, Primary Mortgage Market Survey: 30-year fixed 7.40%, week of October 15, 2026.
- Federal Reserve, H.15 Selected Interest Rates: bank prime loan rate 7.00%, as of October 20, 2026.
- Freddie Mac My Home, “Understanding the costs of refinancing” (accessed October 21, 2026).
- CFPB, “Issue Spotlight: Home Equity Contracts: Market Overview” (January 15, 2025).
- CFPB, “What is a second mortgage loan or junior lien?” and “What is a home equity loan?” (last reviewed September 11, 2024).
- CFPB, “What is a reverse mortgage?” (last reviewed August 28, 2026).
- CFPB, “My lender offered me a Home Equity Line of Credit (HELOC). What is a HELOC?” (last reviewed August 28, 2026).
- Texas Constitution, Article XVI, Section 50(a)(6) (accessed October 21, 2026).
Last reviewed October 21, 2026.