The Equity Take Out Mortgage is a form of Refinance, that doesn’t require paying out existing debt. The additional funds can be used at the discretion of the borrower.

When the borrower’s debt service ratios are calculated, all the other debt is included in the calculation which could determine the maximum amount that can be borrowed. If the same borrower is “refinancing” to pay out high interest credit card debt, they may qualify for more funds, as long as that “additional” money is being direct torward the credit card debt.