Cash-Out-Refi lenders with short seasoning period

10 Replies

A Colorado investor researching SE Michigan where I grew up. Looking into value-add buy-and-holds both single and multifamily. Can anyone recommend an asset based lender who has short seasoning periods on cash-out-refis?

Thank you.

Originally posted by @Jeff Diem :

Thanks Emily. I'll reach out to Emil.

Hey, Jeff. Any luck with this? I am an out of state investor looking at a BRRRR deal and am in the market for a lender that will refi.

I did quite a bit of searching on this topic in 2017, and did not find anyone who would do a fresh appraisal under 6 months. If you want to cash out refi within six months of buying it, there are plenty of banks that will do the delayed financing option, but your loan amount can be no larger than the purchase price of the property. For example, if you purchased for $100,000 and spent $25,000 on rehab, and it appraised for $150,000, your max loan amount would still be $100,000. Not all that useful for a BRRR since the goal is to get as much of your money back out as possible.

Once you're past the six month mark, you can get a fresh appraisal and will be able to get 75% LTV on a single family or 70% LTV on a 2-4 unit property.

You can add your repair funds to escrow, to be released in draws; and this way an investor can get the repair funds back with the delayed financing.

Originally posted by @Kerry Baird :

You can add your repair funds to escrow, to be released in draws; and this way an investor can get the repair funds back with the delayed financing.

Is this a real thing, Kerry?  Is this something you've actually seen banks offer?

Crew,

From my angle (we have both banks/credit unions and large private money sources), Private money is typically the way to go for BRRRR. You have WAY less stipulations and you velocity of money is MUCH higher. Just my 2 cents

Hi Sean,

I did some research on this and messaged you names of some people I've talked with along the way. Seems you can only cash out as much as originally invested, however they are usually private lenders so there are fewer regulations.