Cash-out Refi - Rental Property

[Tyler Rowley]

Hey guys: I want to maximize my LTV for a cash-out refi for my two-unit rental property in Rhode Island. I know 70-75% is pretty standard, but I'm wondering if people know how to get 80-90%. Excellent credit, if that matters.

Thanks. 

[Anthony Thompson]

@Tyler Rowley I generally agree with @Anthony Dooley and I can't remember seeing something better than 75% LTV on an investment property recently but…

I also know that there's a lot of money out there chasing asset-based lending these days. My sense is that I have probably run across quasi-private (small company lenders, possibly backed by hedge funds or private equity cos) who will do higher LTV.

I personally am not comfortable taking on high LTVs at this phase of the market so I dismissed them out of hand and didn’t even save their info, and I hesitate to even post something which isn’t specific/helpful, but I do feel that they are probably out there if you look hard enough.

But I'd also caution you to read the loan terms carefully because my sense when I have occasionally run across these companies that will do higher LTV is that they were pretty sophisticated, so you would want to be careful in dealing with them to know what you are agreeing to.

As I think about it more I think some of those lenders/programs were oriented to make loans to mainly experienced investors and rehabbers, so if you are relatively new to the game you might not fit into their profile.

I wish I could give you specific companies (I think one might’ve been based out of Connecticut) but again I am relatively conservative when it comes to leverage so I didn’t bother to save the info. My guess is that if you do some Googling you’ll probably find a few easily enough—again, there’s a lot of money out there chasing assets to lend on.