Question about cash purchase through LLC for a no seasoning REFI

7 Replies

I recently read on the forum that if you purchase a property for cash through an LLC by lending yourself the money (draw up a mortgage note and file it) that you can REFI out of it with no seasoning and recover your cash. I wanted to verify that this is indeed the case and connect with someone who has actually completed the process. I have an equity line I would like to use to make the purchase and pay the equity line back immediately.

Thanks in advance for any help.

@Andrew Postell  @Jason Sullivan  Thanks Jason, I saw that post. I was looking for someone who has actually used this method. Have you used it? 

@Dave DeMarco while your scenario does happen often it is more rare than just the buying and refinancing of investment properties.  I've had a handful of people in my personal network you use this so I can talk you through what happened what to look for etc. if you would like.  Thanks!

Thanks Andrew, I'll call later this week.

@Andrew Postell


LLC is in place and closing on a rental property in Tennessee on 12/27/2017. I've had the title company prep the note for the loan from my LLC to me, and the deed will be filed at close showing the loan. I have a lender that I have just submitted documents to for the REFI.

Truth be told - I'm nervous. 

Does anyone have a referral to a bank that they have closed with using this method? I would like to have a backup in place.   

Here is the link to what I'm trying to accomplish

@Dave DeMarco

Dave, did you ever get refinanced without a problem? Im looking into doing this and setting up an LLC right now. Still trying to figure how to go about doing that first.

@Eric Saavedra Hi Eric - I wound up not needing to use this method and I'm glad I didn't. I just paid cash and the took out a HELOC. When you pay cash there is no seasoning requirement to do the HELOC. It also saved me A TON of money in closing costs. I refinanced with Penfed Credit Union immediately and had my money back in about 30 - 40 days. I bought another property immediately and repeated the process. I have offers out on 2 properties right now.

PenFed will cost a few hundred dollars in closing costs vs a few thousand. 80% LTV on NOO. They have a minimum loan amount of 10k and will let you do interest only payments. They also will do a desktop appraisal I'm many cases. If I would have done the loan the way I intended when I wrote this post I would not have been able to scale so quickly. The only downside with Penfed is they will limit the number of loans you can do with them 3 NOO plus your primary residence.

Feel free to PM me with any questions and happy investing!

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