How soon can I refinance after purchase? (Source of funds)

2 Replies

I have a question. Lets say I wanted to buy a property for 70k. If someone gifted me the money for the property (the down payment on a mortgage), I would have to wait 2 months worth of bank statements for the funds to qualify as "sourced". 

If I dont have that type of time, I could alternatively pay 70k cash with the gifted funds to purchase the property and then refinance after the fact. Would I be able to refinance immediately, or would the funds used for the purchase still need to be sourced? Does anyone have any thoughts on how to make this happen?

Thank you!

Daniel

@Daniel Kong the problem you are more than likely going to run into is someone to refinance for such a low loan amount.

But if you are looking to purchase the investment property in your current name and can qualify with income and such then gift funds to my knowledge should be allowed to use right away. They just need to be sourced not "seasoned" which is actually the word that should be used when needing to wait 2 months if the funds were just deposited into your account.

To source funds depending on the loan program would normally be a gift letter and bank statements from the person that is gifting you the money.

The other thing that I don't know off the top of my head is if you are allowed to be gifted funds for an investment property. I believe you can...

Originally posted by @Daniel Kong :

I have a question. Lets say I wanted to buy a property for 70k. If someone gifted me the money for the property (the down payment on a mortgage), I would have to wait 2 months worth of bank statements for the funds to qualify as "sourced". 

If I dont have that type of time, I could alternatively pay 70k cash with the gifted funds to purchase the property and then refinance after the fact. Would I be able to refinance immediately, or would the funds used for the purchase still need to be sourced? Does anyone have any thoughts on how to make this happen?

Thank you!

Daniel

If you let the money sit that's a great idea.  Before you get the gift find out what lenders will do loans under 50K.  Your loan amount at 70% of 70K will be 49K so you'll need to get that buttoned up first and foremost!

Have a good one.

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