Realtor · Ogden, UT · Member since 2019 · 338 posts · 415 votes
Hi Everyone,
I currently owe about $195k on my primary mortgage and after studying comps closely (especially with my next door neighbor selling last month) I believe the house will appraise for $280k+.
My mortgage still contains PMI and is currently at about $1,200/month. I would like to refinance (instead of just removing PMI) and cash-out to help me start BRRRing (thank you David Greene!) I don't have much refi knowledge, what would you do as an experienced investor?
1. Refi at 80% LTV and cash out about $40k while still removing PMI?
2. Refi at 90% LTV? That would be amazing...
- Will I still have to pay PMI with this option? How does that work?
- I'm thinking about turning the home into a rental soon, after finding a good house hacking option. Does the 90% LTV only work for non-owner occupants?
3. Any tips for maximizing an appraisal (aside from a great presentation of the house)?
Hey @Brad Jacobson! I'd go with the 80% LTV to give your self a little wiggle room during any market fluctuation and you also wouldn't have any PMI
Would your current home cash flow after you consider all costs/budgeted expenses (Mortgage, tax, insurance, repairs, capex, vacancy, mangagement, etc.) What are the rent comps?
I believe @Mindy Jensen has a book about how to maximize appraisal value of your home!
Hey @Brad Jacobson! I'd go with the 80% LTV to give your self a little wiggle room during any market fluctuation and you also wouldn't have any PMI
Would your current home cash flow after you consider all costs/budgeted expenses (Mortgage, tax, insurance, repairs, capex, vacancy, mangagement, etc.) What are the rent comps?
I believe @Mindy Jensen has a book about how to maximize appraisal value of your home!
@Jake Stuttgen thank you for the tips! Rent comps are looking to be $1,600-$1,700/month and skyrocketing in the crazy UT market right now. An 80% LTV would still cash flow great.
Do you recommend using a local credit union to refinance or is there a certain way you would go about finding a good lender?
I did a cash-out refinance on my house at 90% LTV using a local bank with no PMI. Granted the interest is a bit higher but given that I'm planning on selling in about 18 months having the additional cash worked in my favor.
I love working with local banks and credit unions as they can be a bit more flexible with what they offer. I personally have went and spoke with 10 of them to see what they can offer me and how I "vibe" with them.
@Timothy VanWingerden that's awesome news. I didn't know you could do a 90% and still avoid the PMI. UT is appreciating at a crazy rate and I could still cash flow alright at 90% LTV. Thank you for the suggestion!
@Brad Jacobson Go do it! Just map out 10 or so and go and speak with their commercial department.
I do on smaller projects and depending on what Apartment deal I have in the works (location wise) I'll work with one of my local banks who've I built a good relationship with and built a track record with!