Seattle and Kirkland have seen dramatic property value growth in recent years. This has created a golden opportunity for homeowners and real estate investors to tap into built-up equity.
In competitive markets like these, being able to access capital quickly can give you a serious edge. That’s where cash-out refinancing comes in.
Whether your goal is to scale your portfolio, fund renovations, or restructure existing debt, this strategy can help you unlock equity—without selling off your property.
In this guide, we’ll break down what cash-out refinancing is, how it works in Washington’s real estate market, and how to make it work for your investment goals.
Ready to explore your options? Browse our refinance programs
What Is Cash Out Refinancing?
A cash-out refinance replaces your existing mortgage with a new, larger loan—and gives you the difference in cash.
Unlike a HELOC or home equity loan, a cash-out refinance isn’t a new loan.
Unlike a rate-and-term refinance, which adjusts your loan’s interest rate or length, a cash-out refinance changes both your loan amount and structure.
It’s especially useful when property values have increased, or you’ve improved the asset and want to put that equity to work.
One key metric lenders look at is your loan-to-value (LTV) ratio, which compares your loan amount to the appraised value of your property:
LTV = (Loan Amount ÷ Appraised Property Value) x 100
Example: if your Seattle property is worth $800,000 and you owe $400,000, a lender offering an 80% LTV cap might allow you to refinance up to $640,000. This arrangement would give you up to $240,000 in cash.
LTV caps vary by lender, especially in Washington. For investment properties, many lenders cap LTV at 75%–80% to manage risk. The lower your LTV, the more favorable your terms are likely to be.
For real estate investors, that unlocked capital can go a long way—whether you’re buying another property, funding value-adding renovations, or paying off high-interest business debt.
Want a deeper dive into the refinancing process? Check out our Everything You Need to Know About Mortgage Refinancing.
How Cash Out Refinancing Works in Seattle Real Estate
If you’ve built equity in your Seattle or Kirkland property, a cash-out refinance can be a smart way to unlock it. Here’s how the process typically works:
Step 1: Evaluate Your Equity. Start by reviewing your property’s current value with a comparative market analysis or appraisal. In high-demand neighborhoods like Ballard, Capitol Hill, or Kirkland’s waterfront, appreciation may have significantly increased your available equity.
Step 2: Compare Lenders. Not all lenders approach cash-out refinancing the same way. Some traditional banks require extensive income documentation and longer underwriting timelines. Others, like local credit unions, may offer investor-friendly terms and faster approvals.
Step 3: Apply and Submit Documentation. This usually includes tax returns, income verification, and property records. But not every investor fits the typical lending mold. Lenders like Eastside Funding can underwrite based on the value of the asset, not your credit score or personal income. That can speed up funding and streamline approvals.
Step 4: Appraisal. Your property will need a formal appraisal to determine its market value. In the Seattle area, competitive comps can work in your favor—especially if your property has been recently renovated.
Step 5: Approval and Closing. Once approved, your new loan closes and funds are released. Expect closing costs between 2–5% of the loan amount, depending on your lender.
Pro tip: In King County, appraisals are typically valid for 120 days. If you’re planning to refinance, time it strategically—especially if you’re targeting a specific market window or funding timeline.
Pros & Cons for Washington Real Estate Investors
Cash-out refinancing can be a powerful strategy with many upsides. But, like any strategy, it comes with tradeoffs you should understand.
Pros
- Unlock large amounts of capital without selling
- Fund renovations, acquisitions, or consolidate debt
- Mortgage interest may be tax-deductible (consult a CPA)
- Strong appreciation in Seattle can increase available equity
Cons
- Increases your mortgage balance and may raise monthly payments
- Closing costs (2–5%) can reduce short-term ROI
- Market shifts could leave you owing more than the property is worth
Pro Tip: Before you commit, run ROI calculations. Factor in your new mortgage payment, projected rental income, holding timeline, and how you plan to use the funds.
Want a quick breakdown of refinancing costs? See our guide on the cost of refinancing.
Cash Out Refinance for Investment Properties in Seattle & Kirkland
Lenders view investment properties as higher risk. This means lower LTV caps—usually 70–75%—compared to primary residences due to:
- Higher default risk
- Rental income variability
- Ongoing maintenance concerns
- Stricter underwriting requirements
That said, if your property performs well, rental income can help offset higher mortgage payments. Equity from a cash-out refinance can also fund the next deal or boost property value through improvements.
Demand remains strong in areas like Ballard, Capitol Hill, and Green Lake. These areas—including the Kirkland waterfront and tech corridor—often support higher appraisals and faster ROI.
Note: investment refinances in Washington typically involve more documentation and longer closing timelines. Plan accordingly if you’re using the funds for a time-sensitive deal.
Tips to Maximize Your Cash Out Refinance in WA
To get the most out of a cash-out refinance, timing and preparation matter.
- Improve your financials. A stronger credit score and lower debt-to-income ratio help secure better rates.
- Time it right. Monitor interest rates and refinance when they dip.
- Compare lenders. Get at least three quotes—including from investor-savvy options like Eastside Funding.
- Use funds strategically. Prioritize high-ROI acquisitions, key renovations (like ADUs), or consolidating expensive debt.
- Have an exit plan. Know how the loan will be repaid—via rental income, resale, or another refinance.
Want help figuring out when to refinance? Read our guide on timing your mortgage refinance.
Put Your Equity to Work with Eastside Funding
Cash-out refinancing lets you convert equity into capital without needing to give up your property.
For investors in Seattle and Kirkland, it’s a way to unlock equity and fund your next move—without selling.
Eastside Funding offers fast, flexible refinancing programs built for Washington’s real estate market—with underwriting based on the asset, not just your personal credit.
Curious how much equity you could access? Contact Eastside Funding for a personalized refinance assessment.
