Cash out refinance 3 mos. after holding title?

Question

Purchasing an occupied duplex with private money (dad) @8%.

The challenge is I have to refinance out of that loan 3 months after closing. I could find another private lender that wants to park some money for two years at 8%, no penalty early buy out.

But is there a way to cash out refinance, to pay back lender? After holding title for 3 mos with no mortgage, purchased cash investment property?

George Despotopoulos · Answer

Typically for a 30 year cash-out where the property is owned free & clear, you're looking @ 6 months of seasoning to do 75% LTV where the value is based on the appraised value. If you're refinancing debt and cashing out above that, then it's 3 months of seasoning.

If you're in need of capital, then a bridge cash-out @ 70% - 75% LTV should be possible in as little as 1 month of seasoning (sometimes 3). Rates should be in the 7.5% - 9% range (interest-only) for this type of product. It's a 12 month loan term and should not have a prepayment penalty, allowing you to then refinance into a 30 yr loan should you decide to rent it out and hold long-term.

Stacy D Jackson · Answer

@Katherine Blazer what kind of closing costs are involved?

Javonn Musgrove · Answer

@Fred Shatzoff that would be a possibility as well. I’m down with any type of creative financing that still makes sense for my numbers.

Katherine Blazer · Answer

I work with a private money lender that does no seasoning. So you can refi at day 2 or 3 months.

Jason Shackleton · Answer

Hey @Javonn Musgrove We can likely help here. Our money will come in just under the 8% you are currently paying your dad. We do no income, no asset and no tax verification lending on investment properties.

Good luck,

Jason

Michael Glist · Answer

Look into delayed financing or possibly a bridge loan. Those would likely be your best bet. If you cannot go either of those routes than you may need to look into commercial and NON-QM lenders that do not have a seasoning period. Their rates will likely be slightly higher than that of a conventional lender but if you are needing to refinance in 3 months as opposed to 6 they would be the ones that could likely make that happen.

Kevin Romines · Answer

Are saying that there is no lien against the property? If so, you can use Fannie Mae Delayed Financing to get up the the amount you paid for the property + roll in closing costs, up to a max. of either 80% if it is owner occupied or 75% if non-owner occupied?

If there is a lien on the property, then you can do a rate and term or no cash out refinance after being on title for as little as 10 minutes. It will payoff any existing liens + roll closing costs into the loan and you can have up to $2000 cash back or 2% of the loan amount, whichever is less. You can do that on both Fannie Mae and Freddie Mac.

I hope this helps?

Fred Shatzoff · Answer

@Javonn Musgrove  What if you could get a long term loan?