Refinance Rental with litigation

3 Replies

I am trying to get the equity out from a rental (Condominium) through refinance or HELOC (around 6-7% rate). But there is litigation within the condominium, I have hard time finding a lender to do this. I don't want to go with HML due to it high rate. Can anyone referral a lender that can do this or have another solution?

@Matthew Wu Conventional lenders most likely will not touch this. They usually won't even do a loan with you if you are the defendant in ANY civil suit, much less if the property itself is involved. The fact of this property being involved in the suit not only hinders the likely hood of you getting re-financed but pretty much stops you from selling the property as well. At least this is the case in my investment state. RR

Some time lenders take case by case scenario if the litigation is not due to structural damage or city violations. You have all the paperwork try to contact lender and ask if they can  give you exception. 

I agree with @Harjeet Bhatti . There are 'private' lenders & non-bank direct lenders that will look at loans on a case by case basis and have the ability to assess the litigation and risk to your unit. The rates will be similar to what you stated (generally 7%-8.5%) but may be a bit more restrictive here given the active litigation. This means they may lower their max LTV to account for the circumstances.

It really depends on where the rental is located, the nature of the litigation, and what you're trying to pull out and what for.

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here