Refi Cash Out for SFH Rental

4 Replies

Getting ready to refi out cash. Paid $135k recently to get quick sale.

I’m seeing mostly being able to get out 75% with slightly lower than 4.5 on 30 yr.

Any better scenarios like 85% cash out?

Home is in south Louisiana. Please advise.

Thx.

@Josh Johnson The interest rate and term seem great! Anytime you can get below a 5% interest rate, fixed for 30 years, you're doing well. 

As far as the 75-85% cash out, I work with the BP Federal Credit Union that gives me a 85% LTV but I know some do the 75% LTV cash outs. I would analyze my cash flow (I'm assuming your turning this into a rental) as sometimes it's best to leave a little more equity into a property so you cash flow better.

Best of luck!

On cash out refis in the hard money space I'm seeing between 65 and 70% so I think your option is good. Also, if you do find an 85% option it may trigger PMI.

Hi Josh, 

I am looking at the same thing here in Houston at the moment and would say that the numbers you are getting seem pretty good. Also agree with the point of leaving some reasonable equity in the deal. Everyone is talking about a slowdown possibly in the coming few years and that equity will really help you get through that if the rentals take a hit in your area. 

The best I've seen is 75% LTV. I'm hesitant to go more than 80% due to PMI, being over leveraged in a downturn, and killing my cash flow unless it's got some sort of insanely awesome rent/value ratio.