What’s the best way to refinance my first cash buy?

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I just bought my first property cash with hard money from a family member. I want to pay them back ASAP and would like to know the best way to go about it. Should I apply for term financing or cash out refinancing? Or is their a difference?

@Yvette Tatem . I’m assuming you used hard money to close quickly?  You’re options will depend on what you’re doing with the asset.  Will you be improving it?  If not, do you have a tenant who’s signed a lease?

If you have an executed lease, then a applying for a residential investment property mortgage will be a fairly simple process, because you already have income to support the proposed debt. You'll be eligible for a loan amount equal to: (i) the lesser of 75% of the purchase price (or appraised value whichever is less); or (ii) a loan amount for which NOI from rents supports a DSCR of no less than 1.25x.

However, if you do some improvements to the property before you seek financing and then get a tenant, you can get financing for the appraised ARV.

I hope that’s helpful.  

Terri