Unlimited cash-out refinance refers to no limit is placed on the amount of cash taken from the remaining equity of the home.Even with unlimited cash out programs, most lenders will have a maximum loan amount or a combination of maximum loan amount with certain levels of loan to value.
When you obtain a no limit or unlimited cash out refinance this does not mean that you can take cash out of the equity of your home above and beyond the equity available in your home. It simply means that you can refinance your home and obtain cash for up to the total amount of equity you have available in your home. There are even some lenders and programs that may allow you to go above the value of your home, however they are very high rate loans once you refinance for more than the value of your home.
The equity in your home is equal to the difference between your home's value and the total of any liens against the property. For example, if your home is worth $250,000 and you owe $150,000 on a first mortgage, and you have no other liens, then your equity is $250,000 - $150,000 = $100,000. In most cases, you would not be able to cash out more than the $100,000 in equity.
