Rental Property Investor · DFW · Member since 2015 · 89 posts · 36 votes
Need advice and/or suggestions. I purchase a property last May. I'm interested in perhaps doing a cash out refi. I paid cash for the property. I called a mortgage company in December they told me I had to wait a year to cash out. Question? Do I only have to use local mortgage companies to do a cash out? And, what % of the property can I cash out? Purchase price only or ARV?
Rental Property Investor · York, PA · Member since 2017 · 377 posts · 315 votes
9y
@Val J. - when buying a property, financial institutions will usually loan based on a percentage of the purchase price (although there are some that will loan based on appraisal).
After you own the property, you can refinance based on appraisal value - that's why the BRRRR strategy works when you force appreciation on the investment, allowing you to take out more than you put in (hopefully)
Call around and find a different mortgage company that will refinance on a shorter term. Mortgage brokers can help here if you have any in your network.
You do not have to use a local mortgage company, although local credit unions or smaller local banks are usually interested in portfolio investing.
Rental Property Investor · York, PA · Member since 2017 · 377 posts · 315 votes
9y
@Val J. - when buying a property, financial institutions will usually loan based on a percentage of the purchase price (although there are some that will loan based on appraisal).
After you own the property, you can refinance based on appraisal value - that's why the BRRRR strategy works when you force appreciation on the investment, allowing you to take out more than you put in (hopefully)
Call around and find a different mortgage company that will refinance on a shorter term. Mortgage brokers can help here if you have any in your network.
You do not have to use a local mortgage company, although local credit unions or smaller local banks are usually interested in portfolio investing.
Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
9y
Every lender is different, so I would call around. We've had some lenders that are very strict on seasoning requirements and others who are very loose. Ask for referrals from other investors and then call around.
Hard Money Lender · Dallas, TX · Member since 2017 · 27 posts · 21 votes
9y
@Val J. Plenty of banks/credit unions in Dallas will do cash-out refis after 6 months. They will go off of a current appraised value and lend upwards of 80% of that appraisal. Just keep looking around!