How to pull out money from a 2 flat that isn't your primary residence?

Question

A friend of mine owns a condo that is his primary residence. He owns a 2 flat that he bought a few years ago in a very hot Chicago neighborhood and has gone up in value by almost $200k since. He wanted to pull out some money to use towards buying another building. His lender said since it isn't his primary residence he can't do that. Does anyone know why? Is there a good way to pull out money from an investment property?

Michael Barbari · Answer

@Marcin Talaga

I can do helocs at 75% LTV on properties up to 4 units. Have him call me tomorrow

Brie Schmidt · Answer

If he only has those two properties then a cash out refi should not be an issue if his credit and DTI are up to par. I have a few lenders I can recommend if you want to PM me

Yoochul C. · Answer

I just did a cash out refi on a rental. It should be doable. I got a cash out refi at 4.625 and $125k. Value of the home was $550k

Raya P. · Answer

I think it is because they are stacked one on top of the other and each residence is a whole level of the building, whereas a duplex is usually side by side. I think its kinda charming local vernacular too.

Kirill Chervets · Answer

I just did a HEL or Home Equity Loan on an investment property (I don't occupy it). I got a 75% LTV with under 400 in fees. 20 yr fixed rate. Try giving Key Bank a call.

James R. · Answer

Like the Chicago "two flat" "three flat" terminology. Can't think of anywhere else in the country that uses these terms to describe multi-family properties.

Derek Walvoord · Answer

He needs to check with some good local lenders. It sounds like he is talking to a normal banker at a big bank. Check in with some other banks/mortgage brokers.

Marcin Talaga · Answer

It's under his name.

Michael Barbari · Answer

@Marcin Talaga

I might be able to help. Is the property under his name or an LLC?

How to pull out money from a 2 flat that isn't your primary residence?

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