Refinancing LTV on a small multi family income property

[Derek Samuelson]

I'm interested in pulling some capital out of a duplex I own in the Hampton Roads area of Virginia. I've owned it for about 8 years, it's got an FHA loan on it, there's $112,000 on the loan, and I believe the ARV is $180,000. I'm trying to figure out if I can cash out refinance to an 80% LTV conventional loan on this type of property or should I refinance down to what the remaining balance is and then do a HELOC to pull out the rest of the equity(I'm not sure if that's even an option). I would also like to get rid of the FHA and PMI. If anyone could recommend any banks for this type of situation or any advice would be much appreciated.

[Andrew Postell]

@Derek Samuelson I think your scenario needs some analyzing.  And it's the type of analyzing that you will need a mortgage professional for.  Here's what you need to consider:

• When you refinance, your rate will INCREASE, which will likely make your payment go up. This is because you purchased your home with a primary home loan...and those usually have much better rates than investment properties.
• When you refinance, you will remove PMI, which should help decrease your payment some.
• When you refinance with a conventional "cash out" loan, the maximum you will be able to receive is 70%....so around $10,000 cash out.
• When you refinance with a cash out loan, your rate will be EVEN HIGHER than just a regular "no cash out" loan.

So we really need a comprehensive analysis to see if this is worth it.  It COULD be worth just refinancing with no cash out.  And it MIGHT be worth doing the cash out loan.  We need you to get prequalified and run these scenarios by the lender you are using to see for sure.  Hope this helps in some way.  Thanks!