R&T refi after buying with cash/private loan
How can I continue leveraging parents' cash and do R&T Refi's to keep rates as low as possible?
Wifey & I have 3 SFH in Texas using BRRRR, and are looking for more. We bought each with a private family loan in order to appear as a cash buyer to the sellers, since our target neighborhoods are so competitive. The private loan funds *prior* to closing, and we bring those funds to closing. Our Title Co still files a DoT w/the county to secure the private loan, and later we do a R&T refi with a conforming loan to get the family cash back in order to do it all again later. We'd be happy to continue this model, but the new x-factor is my aging parents will soon no longer be mentally capable of signing legal docs.
I already have full POA, but after talking with our Title Agent after our most recent closing, using my POA in this situation might be viewed as self-serving and lead to issues or delays with refinancing, depending on lenders' attention to detail and/or appetite for such a situation.
I'm looking for a way to stay with a R&T refi and not cause heartburn for lenders. Would one creative solution be to setup an LLC to act as our private lender, for which wifey & I have signatory power? Granted, in spirit, it's the same as potentially using my POA in our current model - in the sense that we're authorizing a loan to ourselves (making payments too, of course), and then we would subsequently release our own loan after the R&T refi closes.
I know we could just use the fam's cash, without the private loan bit, and do a cash-out refi, absorbing the slightly elevated interest rate. But like I said, if there is a legal/ethical way to use the cash without dealing with higher cash-out refi rate, I'm all for it. Even 1/4 pt higher rate would cost more annually than operating an LLC in TX.
If I'm missing another option, let me know.