Wondering if the points thing is really the bank punishing you or just how cash out loans get priced in general, because from what I've seen the rate hit comes from the loan being seen as riskier, not from the bank being greedy. I mean a refi where you just swap terms is way less risk for them than handing you 40 grand on top of it, so the gap kind of makes sense even if it stings. Maybe shop a credit union or two in the Valley, they sometimes play nicer with HELOCs or second liens instead of a full cash out refi. That route can dodge the rate jump depending on how much you need and what your equity looks like.