When people first go looking for their home equity, two products show up: the cash-out refinance and the HELOC. Loan officers tend to pitch whichever one their shop sells best. Here's the difference that actually matters.
A cash-out refi replaces your entire mortgage. New loan, new rate on the whole balance, closing costs measured in thousands, and a fresh amortization clock, which means you start over in the years where payments barely touch principal. In exchange you get a one-time pile of cash and one fixed payment. If your existing rate is higher than today's market, a refi can make sense on its own merits. If you're sitting on a low fixed rate, repricing your whole balance to extract equity is an expensive way to get at your own money.
A HELOC leaves your first mortgage alone. It sits behind it as a second lien, costs little or nothing to open, and gives you a revolving line instead of a pile. You draw what you need, pay it down, draw again. For paycheck parking and chunking, that revolving behavior isn't a nice-to-have, it's the whole mechanism. A refi hands you cash once and the door closes behind you. The line of credit is a door that stays open, which is exactly what the hub in this strategy needs to be.
Side by side: the refi usually wins on rate, the line of credit wins on flexibility, and the refi's rate advantage applies to your entire mortgage while the LOC's higher rate applies only to a small working balance. Run both against your actual numbers, the way the first-chunk math does, before believing either pitch.
A refi that pulls equity out as spending money reverses everything this site teaches. Equity you extract needs a job that pays better than the interest it now costs you. A kitchen you'll enjoy is a purchase, and that's fine, but call it a purchase, not a strategy.