Rhonda L. Wayne -Smith

A HELOC adds a separate revolving credit line secured by your home, while a cash-out refinance replaces your mortgage and delivers equity as cash.
HELOCs typically offer a 5-15 yr draw period, interest-only payments while drawing, then principal-and-interest repayment, with variable rates and access up to ~85% CLTV.
Cash-out refinances can use 15-30 yr terms and fixed or variable rates, but they usually carry 2%-5% closing costs and ~30-45 day timelines.
HELOCs usually close faster, often within 2-3 weeks, and can fit ongoing projects or emergency back-up needs because borrowers pay interest only on used funds.
A cash-out refinance can suit a big one-time expense and one payment, while a HELOC may better preserve an existing low-rate mortgage.

HELOC vs. Cash-out Refinance Costs

Current US refi pricing clustered near 7% for borrowers: 30-yr fixed ~7%, FHA 30-yr mid-6%, jumbo high-6%, 15-yr fixed low-6% in current market.
Refinancing can lower rates, cut monthly payments, shorten payoff timing, remove PMI, or unlock equity, but upfront lender and appraisal costs still matter.
US refinance rates generally track broader mortgage and interest markets, with the 10-yr Treasury moving similarly, while loan size and borrower finances shape quotes.
Stronger credit, higher income, lower LTV, and healthier debt ratios can improve pricing. Consistent payments, less debt, and more equity may help borrowers qualify.
Mortgage points require upfront cash and can trim the rate slightly, so borrowers should compare immediate cost with long-run payment savings carefully before refinancing.