Can I do a cash-out refinance in Texas with an ITIN?

Yes, through Non-QM programs that accept ITIN. In Texas, however, the rules are unique: the state constitution (Article XVI, Section 50(a)(6)) restricts cash-out on a principal residence (homestead) to a maximum of 80% of appraised value, one transaction per 12 months, with mandated waiting periods before closing.

What is the Texas 50(a)(6) rule?

It’s the section of the Texas constitution that governs home-equity loans secured by a principal residence (homestead). Among its requirements: maximum 80% CLTV, lender-fee cap of 2% of the loan (excluding certain charges), 12-day waiting period between application and closing, 12-month waiting period between cash-outs, and specific borrower disclosures.

Can I do a cash-out on an investment property in Texas?

50(a)(6) restrictions apply only to the principal residence (homestead). For investment properties or second homes, DSCR loans or traditional cash-out programs apply without the same constitutional restrictions. This makes Texas particularly friendly for cash-out on investment real estate.

What down payment do I need to refinance with an ITIN in Texas?

Refinances don’t have a cash down payment — what matters is CLTV (combined loan-to-value). For ITIN cash-out on a Texas homestead, the maximum is 80% CLTV. For rate-and-term refinance (no cash out), some ITIN programs go up to 85%. Exact requirements vary by lender.

Educational guide · Texas · ITIN

Cash-Out Refinance with ITIN in Texas: the 50(a)(6) Rules

Texas has unique constitutional rules on pulling equity out of your principal residence. If you're an ITIN taxpayer and already own your home in Texas, this guide explains what you can and can't do when you refinance.

Educational information only. Icon Mortgage is not yet licensed in California. No loan products are being offered.

Notice: Icon Mortgage is not currently licensed in Texas. This page is educational only. The rules below come from the Texas Constitution, Article XVI, Section 50 — not from Icon Mortgage. Consult a Texas-licensed lender and a real estate attorney before making decisions.

What is the 50(a)(6) rule?

Texas is one of only a few states that constitutionally restricts home-equity lending on a homestead (principal residence). Section 50(a)(6) of Article XVI of the state constitution establishes the conditions under which a lender can make a cash-out or HELOC on the home where you live.

Key points

Maximum 80% CLTV

The total balance of all loans on the property after cash-out cannot exceed 80% of the appraised fair market value. If your home is worth $400,000, the maximum post-refi balance is $320,000.

One cash-out every 12 months

The constitution prohibits making more than one 50(a)(6) on the same property within a 12-month period. If you already did a cash-out this year, you must wait until the anniversary.

12-day waiting period

At least 12 days must pass between the date of formal application (with required disclosures signed) and the closing date. It cannot be accelerated — it's a constitutional requirement.

2% fee cap

Lender fees are capped at 2% of the loan amount (excluding interest, title insurance, appraisal, survey, and certain specific charges). This keeps 50(a)(6) loans relatively transparent.

Closing at a neutral office only

Closing must take place at the lender's office, an attorney's office, or a title company — not at your home. If you sign at home, the loan can be challenged.

3 days to rescind

After signing, you have 3 business days to cancel without penalty. It's a constitutional right for Texas borrowers.

Does 50(a)(6) apply to my property?

It applies only to homestead — i.e., your principal residence in Texas. It does not apply to:

Second homes (vacation homes) in Texas
Investment properties (rentals)
Properties outside Texas (even if you live in Texas)
Properties where you do not reside

For investment property in Texas, a traditional DSCR cash-out does not have 50(a)(6) restrictions and allows more flexibility in CLTV and timing.

Where ITIN fits in

The Texas constitution governs the cash-out, but it does not regulate which lenders or borrowers are allowed. An ITIN taxpayer can do a 50(a)(6) with a Non-QM lender that accepts ITIN and complies with all constitutional requirements. In practice, these lenders exist — particularly active in border metros (El Paso, Laredo, McAllen, Brownsville) and in Houston/DFW.

Typical requirements: 2+ years of on-time payments on the current mortgage, post-refi CLTV ≤ 80%, standard ITIN and income documentation, recent appraisal, and compliance with the 12 mandatory disclosures Texas requires.

Rate-and-term refinance (no cash out)

If you just want to lower your rate or change the term without pulling cash out, you're doing a rate-and-term refinance. 50(a)(6) does not apply. Some ITIN programs allow up to 85% CLTV on rate-and-term over a homestead, and the 12-day waiting period does not apply. It's the most common route to reduce payment without constitutional complications.

Common mistakes

Signing at home for convenience.

The law requires closing at a neutral office. If a "lender" insists on coming to your home to sign, be suspicious — they may be operating illegally.

Paying hidden costs above the 2% cap.

If lender fees exceed 2% of the loan, the contract can be voided. Ask for the closing disclosure and verify.

Trying to close before the 12 days are up.

There is no exception. If a lender promises to close a homestead cash-out in a week, something is wrong.

Doing two cash-outs in the same year.

Impossible under 50(a)(6). If you need more cash, wait until the anniversary or consider a separate HELOC (which has its own rules under 50(a)(6)(b)).

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This page is educational. Section 50(a)(6) of the Texas Constitution is complex and is amended occasionally — the most recent major expansion was in 2017. Consult a Texas-licensed lender and a real estate attorney before signing any document. Nothing on this page constitutes legal advice, financial advice, a rate quote, or a loan offer.