HELP! Hope I didn't lose my down payment...

[Pete Fiannaca]

Hey BP Folks -

I posted here yesterday, but wanted to elaborate a bit on my question. I recently put 20% down on a single family investment. Upon looking around at refi, HEL, HELOC options, I'm afraid I just buried that money in the dirt.

Anyone have suggestions/best practices for pulling that original 20% equity out of the property in order to reinvest it elsewhere? Am I stuck?

Best,

Pete

[Kurt A.]

Hi Pete,

If you have already signed the documents or put the money in, there is not much you can do. But don't worry you can refi with money out after you make your "upgrades" to the home. If you own the home personally, not in an LLC or Business, you should be able to refi fairly quickly with a signed tenant lease agreement. The key would be to make upgrades to increase the value above the OPP. Currently, some banks, private lenders, and RE lenders (higher points) are allowing refi with money out above 20%.

I would note, most successful investors including B. Turner like to keep 25% in each of their rental properties. B. Turner did several podcast on this...look around #150+ for the latest reason you are doing well with 20-25% in equity. Also, research his podcast on creative financing, if you need additional $$ for your next home. 

Goodluck and don't forget to vote. I couldn't find your previous post to review.