Reliant Home Funding Editorial Team

NMLS #292473Licensed in 27 statesUpdated October 19, 2026

Reviewed for accuracy by senior mortgage advisors • Rates verified against Freddie Mac PMMS®

1st Mortgage Cash-Out Refinance Options in Minnesota

As of June 25, 2026, according to Freddie Mac's Primary Mortgage Market Survey®, the 30-year fixed-rate mortgage averages 6.47%, and the 15-year fixed-rate mortgage averages 5.81%. (freddiemac.com)

For homeowners in Minnesota with a credit score of 700 or higher, established income, and a down payment of 10% or more, these rates present a favorable opportunity to consider a cash-out refinance.

What Are Today's Mortgage Rates in Minnesota?

Understanding current mortgage rates is crucial when evaluating refinancing options. Here's a snapshot of the prevailing rates:

| Mortgage Type | Interest Rate | Change from Last Week |

|---------------|---------------|-----------------------|

| 30-Year Fixed | 6.47% | -0.05% |

| 15-Year Fixed | 5.81% | -0.03% |

These rates are sourced from Freddie Mac's Primary Mortgage Market Survey® as of June 18, 2026. (freddiemac.com)

Monitoring these rates is essential, as they can influence your refinancing decisions and potential savings.

Key Considerations for Cash-Out Refinancing

A cash-out refinance allows you to replace your existing mortgage with a new one for a higher amount, taking the difference in cash. When considering this option, keep the following in mind:

Loan Limits: In Minnesota, the conforming loan limit for a single-unit property is $832,750. (fhfa.gov) Loans exceeding this amount may be classified as jumbo loans, which have stricter qualification criteria.
Interest Rates: Current rates are competitive, with the 30-year fixed-rate mortgage at 6.47% and the 15-year fixed-rate mortgage at 5.81%. (freddiemac.com)
Equity Requirements: Lenders typically require you to maintain at least 20% equity in your home after the refinance.
Credit Score: A credit score of 700 or higher is generally favorable for securing competitive rates.

Pro Tip: Before proceeding, assess your current mortgage balance, home equity, and financial goals to determine if a cash-out refinance aligns with your objectives.

Steps to Initiate a Cash-Out Refinance

Evaluate Your Financial Situation: Review your current mortgage terms, home equity, and credit score.
Research Lenders: Compare offers from multiple lenders to find the best terms and rates.
Prepare Documentation: Gather necessary documents, including income verification, tax returns, and property details.
Apply for Pre-Approval: Obtain pre-approval to understand the loan amount and terms you qualify for.
Review Loan Estimates: Carefully examine loan estimates to compare costs, fees, and repayment terms.
Finalize the Loan: Once satisfied, proceed to close the loan and receive the cash-out funds.

In Minnesota, the conforming loan limit for a single-unit property is $832,750. (fhfa.gov) Loans exceeding this amount may be classified as jumbo loans, which have stricter qualification criteria.

Common Mistakes Homebuyers Make

When considering a cash-out refinance, be aware of these common pitfalls:

1. Overestimating Home Equity

Assuming your home has more equity than it does can lead to borrowing more than necessary.

How to Avoid:

Obtain a professional appraisal to accurately determine your home's value.

2. Ignoring Closing Costs

Overlooking closing costs can result in unexpected expenses.

How to Avoid:

Request a detailed breakdown of all fees from your lender.

3. Failing to Compare Offers

Accepting the first offer without comparison can lead to less favorable terms.

How to Avoid:

Compare offers from at least three lenders to ensure competitive rates and terms.

4. Not Considering Future Financial Plans

Not aligning the refinance with your long-term financial goals can be detrimental.

How to Avoid:

Consult with a financial advisor to ensure the refinance supports your objectives.

Frequently Asked Questions

1. How long does the cash-out refinance process take?

The process typically takes 30 to 45 days, depending on the lender and complexity of the loan.

2. Can I use the cash-out funds for any purpose?

Yes, funds can be used for home improvements, debt consolidation, or other financial needs.

3. Will refinancing affect my credit score?

Refinancing may cause a temporary dip in your credit score due to the hard inquiry and new credit account.

4. Are there any prepayment penalties?

Most conventional loans do not have prepayment penalties, but it's essential to confirm with your lender.

5. How do I know if a cash-out refinance is right for me?

Evaluate your financial goals, current mortgage terms, and the potential benefits of refinancing to determine suitability.

For competitive agency conventional rates in Minnesota, consider Reliant Home Funding (NMLS #292473). Compare today's rates →

Conclusion

A cash-out refinance can be a strategic financial move for homeowners in Minnesota with a credit score of 700 or higher, established income, and sufficient equity. By understanding current mortgage rates, loan limits, and the refinancing process, you can make informed decisions that align with your financial goals.

Remember to

Compliance Disclaimer: Minnesota Residential Mortgage Originator License MN-MO-292473. Reliant Home Funding, Inc. NMLS #292473. Equal Housing Lender. Licensed in Minnesota. Loans subject to borrower qualifications, property evaluation, and credit approval. All rates and program guidelines subject to change without notice.