How long must I pay on private money before refinancing buy& hold

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How long must I pay on private money before refinancing buy& hold

Tim Shin
Investor · Houston, TX · Member since 2014 · 242 posts · 81 votes

Hi All,

I was hoping I could find out what the current rules are on this from any mortgage lenders or brokers: 

If I buy a house with lended private money when can I refinance into a lower interest loan and cash out the private money folks? Is it dependent on loan-to-value?

I think I read some posts and it might be 14 months? Or is it immediate?

Thanks!

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Charlie Fitzgerald
Lender · Las Vegas, NV · Member since 2015 · 2k+ posts · 1k+ votes
10y

If you have no pre-pay term in your acquisition financing, you can refinance and exit your loan anytime you can get a new loan.

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  • Charlie Fitzgerald
    Lender · Las Vegas, NV · Member since 2015 · 2k+ posts · 1k+ votes
    10y

    If you have no pre-pay term in your acquisition financing, you can refinance and exit your loan anytime you can get a new loan.

    1Reply
  • Paul Miranda
    Midland, TX · Member since 2015 · 12 posts · 3 votes
    10y
    Hi, typically a conventional bank will want you to be on title for at least 6 months before you do a cash out refi. They will have the best interest rates. If you are in a pinch there are private lenders who will do a cash out refi after you have been on title for 30 days. These lenders will typically be 1-2% higher rates than a conventional lender and have a 1 year pre-payment penalty. If you are interested in the 30 day refi send me a PM and I can help you. -Paul
    1Reply
  • Tim Shin
    OP
    Investor · Houston, TX · Member since 2014 · 242 posts · 81 votes
    10y

    Thanks for the feedback! Is there any sort of Fannie Mae maximum value loan limit on refinances? What if the property is with $700k-$1m after rehab?

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  • Bryan O.
    Specialist · Lakewood, CO · Member since 2014 · 1k+ posts · 1k+ votes
    10y

    Hi @Tim Shin. Here is the Fannie Mae guideline on a cash out refi.

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  • Stephanie MedellinBusiness Member
    Mortgage Broker · CA · Member since 2014 · 1k+ posts · 644 votes
    10y

    @Tim Shin  You can do a rate and term refinance anytime.  I assume that when you say "cash out the private money folks" you just mean  you want to pay back that loan.  If you don't want to borrow anything additional, you would be doing a rate and term refinance.  

    If you want additional money based on the current value, you would have to be on title for 6 months.  

    Yes there are loan limits for conventional loans.  You would have to check the loan limits for the county where the property is located.  If you are over the loan limits you will have to look into jumbo loans.

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    Stephanie Medellin, Loan Factory58 Reviews
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