How much is typically allowed in a cash out refi? Is it something like 75% of equity in the property? So if you have 25% equity in a $1M home, you can take .75($250K)=$187.5K? I know that 75% can vary by lender but was just curious if that is how it works, and what is the most common amount lenders will let you take. Thanks in advance!
@Raj Tirur First, I am assuming it is not your personal residence. A refi means you are refinancing--replacing existing financing. What you describe above would be a home equity loan--getting a loan on the equity you have in a house.
For refis, most (not all) lending institutions require a seasoning period, often one year. This is how long you have to have owned the property before they will even consider a refi.
If you own it in your name, you can likely refi for 80% loan to value after the seasoning period. If you only have 25% equity, this won't get you much or any cash in your pocket, but you may get better terms than with your original financing.
If you do not own in your name, it is likely going to be 70% to 75% loan to value.
I think you will find it difficult to get a home equity loan if you only have 25% equity unless it is your personal residence.
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