Reliant Home Funding Editorial Team

NMLS #292473Licensed in 27 statesUpdated October 2, 2026

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

Understanding Cash-Out Refinance Options in South Carolina

Purchasing a home is a significant milestone, and understanding your financing options is crucial. As of January 29, 2026, according to Freddie Mac's Primary Mortgage Market Survey® (PMMS®), the 30-year fixed-rate mortgage averaged 6.10%, and the 15-year fixed-rate mortgage averaged 5.49%. (freddiemac.com)

If you're considering refinancing your current mortgage to access your home's equity, a cash-out refinance might be a suitable option. This guide will provide you with essential information on cash-out refinancing in South Carolina, including current rates, benefits, and common pitfalls to avoid.

What Are Today's Mortgage Rates in South Carolina?

Understanding current mortgage rates is vital when considering a cash-out refinance. As of January 29, 2026, according to Freddie Mac's PMMS®, the 30-year fixed-rate mortgage averaged 6.10%, and the 15-year fixed-rate mortgage averaged 5.49%. (freddiemac.com)

Here's a comparison of the current rates:

Loan Type	Interest Rate	Week Change
30-Year Fixed Mortgage	6.10%	-0.02%
15-Year Fixed Mortgage	5.49%	-0.01%

These rates are subject to change and can vary based on individual qualifications and market conditions.

Cash-Out Refinance: Key Considerations

A cash-out refinance allows you to replace your existing mortgage with a new one for a higher amount, taking the difference in cash. This option can be beneficial for various financial needs, such as home improvements, debt consolidation, or covering major expenses.

Pros of a Cash-Out Refinance:

Access to Home Equity: Utilize the equity you've built in your home for significant expenses. This can be an effective strategy if utilized responsibly and not borrowed excessively.
Potential Tax Benefits: Interest paid on a cash-out refinance may be tax-deductible.
Lower Interest Rates: Mortgage rates are often lower than rates on credit cards or personal loans.

Cons of a Cash-Out Refinance:

Increased Loan Balance: Your mortgage balance will rise, potentially leading to higher monthly payments.
Closing Costs: Refinancing involves fees such as appraisal, title insurance, and origination fees. Ensure you understand these costs ahead of time.
Risk of Foreclosure: Defaulting on your mortgage can lead to foreclosure, as your home serves as collateral. It's vital to ensure that the refinance aligns with your financial capacity to make repayments.

Pro Tip: Before proceeding with a cash-out refinance, assess your financial situation and consult with a financial advisor to ensure this option aligns with your long-term goals.

Steps to Secure a Cash-Out Refinance in South Carolina

Evaluate Your Home Equity: Determine the current value of your home and subtract your existing mortgage balance to find your equity.
Check Your Credit Score: A higher credit score can secure better interest rates.
Gather Necessary Documentation: Prepare financial documents such as income verification, tax returns, and a list of debts.
Shop Around for Lenders: Compare offers from multiple lenders to find the best terms.
Apply for the Refinance: Submit your application along with the required documentation, keeping in mind that rate locks happen post-application.
Close the Loan: Review and sign closing documents to finalize the refinance.

Pro Tip: Utilize online mortgage calculators to estimate potential monthly payments and determine if a cash-out refinance is financially feasible for you.

Common Mistakes Homebuyers Make

1. Overestimating Home Value

Impact: Leads to borrowing more than your home is worth, increasing the risk of owing more than the property's value.
How to Avoid: Obtain a professional appraisal to accurately assess your home's market value.

2. Ignoring Closing Costs

Impact: Underestimating fees can result in unexpected expenses during the refinancing process.
How to Avoid: Request a detailed breakdown of all closing costs from your lender.

3. Failing to Compare Lenders

Impact: Accepting the first offer may mean missing out on better terms elsewhere.
How to Avoid: Obtain quotes from multiple lenders to ensure competitive rates and terms.

4. Not Considering Long-Term Financial Impact

Impact: Short-term gains may lead to long-term financial strain due to higher loan balances and payments.
How to Avoid: Evaluate how the refinance fits into your long-term financial plans and goals.

5. Overlooking Alternative Financing Options

Impact: Refinancing may not be the best solution for your financial needs.
How to Avoid: Explore other options like home equity loans or lines of credit to determine the most suitable choice.

Frequently Asked Questions

1. How long does the refinancing process take?

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

2. Can I refinance if I have less than 20% equity in my home?

Yes, but you may be required to pay for private mortgage insurance (PMI) if your equity is below 20%.

3. Will refinancing affect my credit score?

Refinancing can cause a temporary dip in your credit score due to the hard inquiry, but it may improve over time with timely payments.

4. Are there any prepayment penalties for refinancing?

Most lenders do not charge prepayment penalties, but it's essential to confirm with your lender.

5. Can I refinance if I have a second mortgage?

Yes, but the second mortgage may need to be subordinated, or you may need to pay it off during refinancing.

For competitive rates in South Carolina, consider Reliant Home Funding (NMLS #292473), licensed in South Carolina. Compare today's rates →

Conclusion

A cash-out refinance in South Carolina can provide access to your home's equity for various financial needs. By understanding current mortgage rates, evaluating the pros and cons, and following the proper steps, you can make an informed decision. Always consult with a financial advisor to ensure this option aligns with your financial goals.

Loans are subject to credit approval. Rates and terms may change. NMLS #292473. Ready to explore your refinancing options? Check your personalized rates now and take the next step toward achieving your financial objectives.