Question about Home Equity Loan

[Steve S.]

Not a HELOC

For the sake of example, let's say a home appraises at $100,000  

I have $55,000 in Equity and owe $$45,000 at 3.75% on a 30 year note. 

I've found an amazing deal and would like to use some of this Equity towards the next property. 

Typically a lender will only allow up to 80% LTV so I would be able to get $25,000 out in Equity. (Here's the math - must owe now more than $80k and 80-55 is $25,000)

So here's the question. If a lender says they will

Do a Home Equity Loan at 5%, would I pay the $25,000 at 5% and the rest of my original mortgage stays at the 3.75%?  

Or would I now have an $80,000 loan at 5%?