Denied 2x for ReFi on cash flowing duplex. Need advice please!

[Emilio Basa]

Hi everyone,

I have a dilemma on my hands and I'm looking for some advice. I have a duplex in a very desirable neighborhood in Michigan. It's never vacant because of the location and because of the condition. I purchased this on land contract and spent about $20K on repairs. I ran out of cash and place the repairs on my credit card. I maxed out 2 credit cards getting the duplex rent ready. 

My issue is that the duplex consistently rented and making money, but my maxed out credit cards are killing my debt to income ratio. My credit is good and I'm making payments, but just not enough to bring the ratio to a level that is deemed "worthy" to a traditional lender. Are there any lenders out there that will refi my out of a land contract but won't charge me 9-10% at 30 year? 

Looking for some advice and help.

[Chris Mason]

Originally posted by @Emilio Basa:

Hi everyone,

I have a dilemma on my hands and I'm looking for some advice. I have a duplex in a very desirable neighborhood in Michigan. It's never vacant because of the location and because of the condition. I purchased this on land contract and spent about $20K on repairs. I ran out of cash and place the repairs on my credit card. I maxed out 2 credit cards getting the duplex rent ready. 

My issue is that the duplex consistently rented and making money, but my maxed out credit cards are killing my debt to income ratio. My credit is good and I'm making payments, but just not enough to bring the ratio to a level that is deemed "worthy" to a traditional lender. Are there any lenders out there that will refi my out of a land contract but won't charge me 9-10% at 30 year? 

Looking for some advice and help.

 You need to find a loan officer or mortgage broker with an IQ greater than a cabbage, licensed in your state (I am CA only), that can set it up so the credit cards are paid off through escrow with proceeds from the cash out refinance. This is a very basic 101 level trick approach (not even a trick)...

One of my first "doing God's work" refinances when I was fresh off of the Loan Officer Assembly Line was a dude that went $80k (or some crazy number) in debt taking care of his dying mother. The cash out refinance brought his DTI down to 38% from 72%, and his monthly debt servicing expenses decreased $750 per month (!!!). We put $40k in his checking account while we were at it. She has since passed away, but her final months were better than they otherwise would have been, and her son's financial health certainly a crap ton better than it would have been (I caught him right before he was going to start missing payments, disqualifying him from any mortgage because his FICO was already shaky as it was). I'm probably always going to remember that deal, and that guy's name who was doing whatever it took to take care of his mom while his siblings slacked off.