tap in to my equity

6 Replies

I recently started flipping real estate in my free time. 3 homes in just over a year. The last home I purchased I have decided to keep for my self and live in for several years. With the profit I made from my flips I was able to put 20% down and do enough work to the home to gain around 60k in equity  but now I still have a small list of things I would like to do to the home and would like to have money for a down payment on a duplex .   I have not owned the house for a year yet so the bank won't do a refi.    What is the best way for me to get to my equity ?

I'm guessing this is an FHA mortgage you're in now? If so, you're right, you won't be able refi for at least a year. However, once that mortgage has seasoned for 6-mo you may be able to get a HELOC, if you have sufficient equity and can get an appraisal to support it.

You'll be better off pursuing that option with a smaller, local lender, not a big bank.

thanks for the reply 

The mortgage is a portfolio conventional 

All local banks I have spoke to have said they do not offer helco or cash out refi intil I have owned the home for 12 months    is it possible to do a hard money loan to pay off mortgage plus draw from equity then turn around and refi it with the bank in a year 

@Justin Colley  

As mentioned by others if it is a conventional mortgage the seasoning period unfortunately will be around 6 months and I think trying to go the HML or private lending route while might get you some of the equity out will cost you a ton in points, fees, and then ultimately closing when you try and refinance out the HML.

However, if you do a portfolio loan or commercial loan (loan to an entity) than often the banks do not have seasoning requirements.  For example, I do not.  However, those loans have shorter ammortizations generally (15-20 years) and higher interest rates.

@Justin Colley   Fannie mae's waiting period is 6 months, not 12, I'd shop around with a mortgage broker to find a lender that underwrites to fannie guides.

Originally posted by @Justin Colley:

I recently started flipping real estate in my free time. 3 homes in just over a year. The last home I purchased I have decided to keep for my self and live in for several years. With the profit I made from my flips I was able to put 20% down and do enough work to the home to gain around 60k in equity  but now I still have a small list of things I would like to do to the home and would like to have money for a down payment on a duplex .   I have not owned the house for a year yet so the bank won't do a refi.    What is the best way for me to get to my equity ?

 Conventional guides like Jesse mentioned is 6 months however the advantage is waiting till the 12th month because you can cash out using the market value instead of the lower of appraisal or purchase price which tends to be the purchase price when talking to investors.

What is the rate on your first loan and what is the loan amount? You might be able to refinance the first and add a HELOC since not all HELOC's are 6-12 months it all depends on the banks since banks usually hold HELOC's as a portfolio product this will cause guidelines to vary all over the spectrum.

Albert Bui, Lender in CA (#345453), WA (#345453), TX (#345453), and TN (#345453)
949-514-5106

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