Can a VA cash-out refinance pay off my HELOC or second mortgage along with my first mortgage?
Yes. A VA cash-out refinance may pay off your first mortgage and a HELOC or second mortgage secured by the same home, subject to eligibility, property state, appraisal, title and lender review. Texana does not offer VA cash-out refinancing on a Texas homestead.
Federal law lets a VA refinance pay off mortgages and other recorded liens on your home.
Federal law permits a VA-guaranteed loan to refinance existing mortgage loans or other liens secured of record on a home the veteran owns and occupies (38 U.S.C. §3710(a)(5)). A HELOC or second mortgage recorded against the same home can be part of that payoff, subject to eligibility, property state, appraisal, title and lender review.
Texana does not offer VA cash-out refinancing on a Texas homestead. For other properties, availability still requires a review of the property state and the complete loan file.
Bottom line: Refinancing a HELOC or second mortgage moves that balance into the new mortgage. It does not erase the debt, and your home remains collateral.
What Still Has to Qualify
Paying off both mortgages does not replace the qualification process.
Eligibility and credit
VA lists a Certificate of Eligibility and meeting VA’s and your lender’s standards for credit, income and other requirements as parts of a cash-out review.
Occupancy and appraisal
VA says you must live in the home you are refinancing, and the lender orders a home appraisal.
Both liens and the payoffs
Bring statements for both loans. For an open HELOC, ask how the credit line and the recorded lien will be handled at closing, and which payoff authorizations are needed.
Compare the Whole Mortgage
The refinance replaces your first mortgage as well as the second lien.
That means the comparison has to include what happens to your existing first-mortgage terms, not only the HELOC balance.
How the two payoffs fit together
CFPB lists home equity loans and HELOCs as common examples of second mortgages: another debt secured by your home. A cash-out refinance pays both lenders from the new loan, so both balances become part of one mortgage.
Closing costs and the replacement rate
CFPB notes that a cash-out refinance often comes with closing costs and tells borrowers to consider the interest rate carefully, especially when it is higher than the rate on the current mortgage.
VA’s borrower-benefit test
VA’s refinance regulation requires the new loan to provide a net tangible benefit and requires the lender to give you a comparison of the old and new loans, including the total you would pay over each. Ask to see your combined payments today next to the proposed mortgage, remaining debts and total repayment cost.
Do not count the same proceeds twice
Money used to retire your HELOC is money unavailable for another purpose. Read the payoff and cash lines separately before planning around any proceeds.
Common Traps
Do not let a refinance pitch outrun the math.
“The HELOC goes away”
The balance does not go away. It is paid from the new mortgage, and the home secures that larger loan.
“There will be cash left over”
Not automatically. Cash depends on the approved financing, both payoffs and transaction costs.
“A lower monthly total means savings”
Not necessarily. CFPB warns against trading short-term debt for long-term debt at a higher cost. Compare closing costs, total interest and how long you expect to keep the loan.
Sources
Federal law, VA and CFPB guidance
38 U.S.C. §3710(a)(5) authorizes refinancing existing mortgage loans or other liens secured of record on a home the veteran owns and occupies. 38 CFR §36.4306(a)(3) (amended 83 FR 64468, December 17, 2018) sets the net tangible benefit test and comparison disclosures. VA’s cash-out refinance page was updated January 7, 2026. CFPB pages: second mortgages (reviewed September 11, 2024), loans similar to a HELOC (reviewed June 27, 2024) and HELOCs and refinancing (reviewed February 2, 2024). Texas Attorney General Opinion KP-0183 was issued February 26, 2018. Sources checked November 4, 2026.
Include your property state and explain that you have a first mortgage plus a HELOC or second mortgage. Subject to credit approval and applicable program requirements. This is not a commitment to lend.
No. VA says a VA-backed cash-out refinance can replace a non-VA mortgage when the borrower, property and transaction qualify.
No. Cash depends on the approved financing, both payoffs and transaction costs. Request a breakdown before assuming money will remain.
Possibly, but tell your banker at the start. CFPB explains that the HELOC lender may need to approve the refinance; if it refuses, paying off the HELOC may be necessary.
No. A lower monthly total can come with higher overall costs when repayment stretches longer. Compare closing costs, total interest and the time you expect to keep the loan.
Reviews
What borrowers say about Texana Bank
Real reviews from real borrowers, pulled live from our Google Business Profile.
Texana Bank helped me with the purchase of my third home, and honestly, the experience was the smoothest of all three home purchases. I only worked with Lynette, but she was friendly, helpful, and courteous at all times. She was extremely patient with me, and she took time to answer all my questions. Even more impressive is that the bank worked with me through a challenging employment situation. Never once was I made to feel bad about asking questions, and Lynette's responses were lightning fast. This was one of the best experiences I have ever had with any company, bar none. I highly recommend Texana Bank to anyone.
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Mikayla Irwin
★★★★★
Lynette Heck is the best to work with. No matter what we needed, she was on top of it and thinking of things way before we needed it! We really appreciate everything she did for us!
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Mark Sherrard
★★★★★
Overdue but thanks again Adam, I appreciate you going above and beyond to make sure my family got our dream home. 10 stars.
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Carson Romero
★★★★★
My experience with Lynette was the best and easiest experience it could’ve possibly been when being a first time home buyer. She’s very kind, communicative, reliable, and so much more! It made the whole process that much less stressful and overwhelming. So blessed to have had her on my side!
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Zane Atkins
★★★★★
Parker McMahan has helped us with 3 mortgages and a refi in part few years. Always great service-always honest advice. Texana will be my “go to” for mortgage advice and activity from here on. They are also great in the area of VA home loans.
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Gary McDay
★★★★★
I had an excellent experience working with my texana bank mortgage from start to finish. They were extremely professional, knowledgeable, responsive, and made the entire mortgage process feel much easier than I expected.
They took the time to explain everything clearly, answered all of my questions, and kept me informed throughout the entire process. I always felt like I had someone in my corner who genuinely cared about helping me reach my goals.
If you’re looking for a mortgage broker who is trustworthy, dependable, and willing to go the extra mile for their clients, I highly recommend them. I truly appreciate all of their hard work and would definitely work with them again!
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Kent Sisco
★★★★★
Adam McCormick is fantastic! Easy to work with and keep me informed every step of the way! Looking forward to working with him again in the future
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Andrea Ferrell
★★★★★
Adam was phenomenal from start to finish! He was friendly and professional. He assisted me every step of the way, walking me through the process with ease. He was always there for whatever questions I had. He was very, very patient and always reached out to me in a timely manner if I contacted him and he was unavailable at the time. Moreover, he made me feel as if he cared for more than just my loan, but me as a person!!! Texana is blessed to have him as an associate!!
Andrea
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Clay Ragsdale
★★★★★
Where to really start. Adam walked me through everything and put me at ease. I have had some bad experiences with other companies so I was digging and looking for any red flag. There was none with him and his direct talk is what did it for me. Someone that is real and just says what it is. No false hope or misdirection at anytime.
I would recommend him to anyone and definitely Someone looking for honesty and caring. The communication is top notch and a true professional.
Respectfully,
Clay
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Belvia Lynn
★★★★★
My overall experience while working with Adam McCormick was excellent. He was very pleasant and professional.
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Joseph Hardman
★★★★★
Adam McCormick is an absolute professional in every sense of the word. I will NEVER use any other loan officer for my financials other than Adam as long as he is in the business. His work as my loan officer was exceptional. Throughout the process, he always responded to an e-mail, responded to a text, called right back if not answering immediately. He always made you feel as though you were his only client. There was never the impression he had more important things to do other than speak with you. He worked with us through a death in the family, personal issues, and numerous other challenges. It's possible other loan officers would have given up on us during this process, but Adam stuck with us through it all. His work ethic is amazing. He is an expert in his craft. I could not possibly give a higher recommendation, he has redefined what right looks like in this business.
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Marsha Kessler-Bradshaw
★★★★★
I was about to go with another company for this refinance no cash out until I received a call from this Adam McCormick. He was so knowledgeable and made me feel very comfortable with this process. Adam is knowledgeable ,courteous, understanding and has a real passion and patience for people. 👍We are at the closing. Thank you Adam McCormick!!
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Peter Jenkins
★★★★★
My situation had its difficulties. Justin was confident and persistent through the process and we the got the result
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Dale Samuel
★★★★★
Mark has been very professional and has been very respectful to my wife and myself.
Mark has shown that genuine human qualities and really worked with us and for us.
This actually been a pleasure to get to know Mark.
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James Fields
★★★★★
Outstanding Service and support from a truly Customer Oriented Agent! My pleasure to have worked with Mr. MCcormick.! Would follow him to next source if necessary. He is concerned in an outstanding balanced way. My pleasure to?know and do Business with him and The Bank!
JFields
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Rose Stone-Stewart
★★★★★
Texana Bank was there for us throughout the entire process. Their personableness, as well, their professionalism. As a financial institution it was nice to know that while obtaining a loan, we had a safe place to relay. They are absolutely “by the book” and at the same time makes the process easier to participate. The hospitality and genuine concern as clients was overwhelming of which we will always consider Texana Bank first, before mostly any other financial institution.
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Mitchell Morris
★★★★★
Greg was awesome and the process was simple. I have nothing but the highest praise for the process and for Greg himself. Thank you.
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Ronald Bylsma
★★★★★
Best refi experience of our lives, Andre was very knowledgeable and always kept us calm when things got stressful. Would recommend Mr. Andre Floyd to anyone looking for a great lending officer!