Refinancing a 4 unit building

[Brian Evans]

I have purchased a 4 unit SFH. Have done significant renovations and improved the rents on the property. It was a cash purchase and am looking to refinance for as much back as possible. I was hoping for a discussion is if there is a way to have 4 unit building appraised as commercial real estate? or how to approach the loan and appraisal process to get as much money back as possible?

[Jon Holdman]

I would agree with Jared Rine that a conventional loan will probably give you a better LTV and better terms. Since this is a cash out refi, you will probably need to own it for at least a year to get a refi based on a new appraisal. If you're OK with using just the purchase price and documented rehab expenses as a value, you can probably do it quicker.

Why do you want to have it "appraised as commercial real estate"? I assume you mean you want to have it appraised based on income rather than comps. An appraiser may well look at both approaches and take whichever value is lower as the value. If an income based valuation produces a high value but there are good comparable properties that sold at lower values, the appraiser will probably not use the higher value.