Bought a house Cash 2 months ago. Lenders are saying no cash out

6 Replies

Bought a house cash in July. Im nearing the end of my Renovation.  Im in Arlington Tx.  2 different lenders are now telling me they can not do a cash out refinance for at least 6 months.  

I have no mortgage of any kind on the house. Its a 300k house and im trying to just take 100k out.

is this correct? Even though I have no mortgage on it- I can't do any kind of refinance for 4 more months? 

@Tom Brickman if you're willing to do a commercial loan then you should be able to do it with no seasoning. At least that's my experience in my market.

I'd recommend calling the smallest 5-10 local banks and credit unions and ask to speak to the commercial lender. You might be surprised by what they're able to do.

@Tom Brickman

I have heard this as well from different lenders but I would not stop looking around and speaking to other lenders, banks and credit unions in your local market. It just takes one.

@Tom Brickman In the wake of Covid-19 many commercial lenders who previously offered little to no seasoning have since moved that back to at least 6 months to use appraised value rather than purchase price. However, if you're looking for low LTV like this you can still get it done now once the property is leased w/o seasoning because these same lenders will usually allow up to 70% LTC prior to 6 months meaning up to 70% of what you purchased it for rather than your new forced appraised value. Hope this helps. If $100k is less than 70% of what you bought it for you should be good. Keep me posted.

Hey Tom, you can potentially do a 70% LTV cash-out based on appraised value, you would just need the property rented. Yes, most will require 6 months+ of seasoning but if you're in it for a significant amount, meaning your purchase price + rehab costs are greater than 70% LTV (70% of appraised value) then you should be good to go. Some may be even willing to grant an exception and not cap you at 100% of your cost basis as long as everything else looks good.