All Forum Posts by: Chris Smith

Hi All, 

Hoping to get some info/ help here. I close tomorrow on my refi and its been like pulling teeth the entire process.

I purchased my first property two years ago and it had two combined lots, with a home on lot 2. The county said I could segregate at any point. The bank agreed but they are both under the current mortgage.

I improved Lot 2 (The home and it's lot) enough to appraise for enough to cover the loan. I am now closing on a refinance which is just for lot 2 and the home on it.

Along with the deed of trust for the new loan on lot 2, is there anything the title company needs to be filing to show that I now own lot 1 free and clear? I have not seen any documentation about lot 1 being paid off, etc.

My concerns stem from the mobile title showing up two days ago having the deed of trust with both parcels still on it and I had to send him away.

Sorry if this is confusing, Any advice would be awesome and much appreciated-

 Thank you Austin, I will take a look. I guess it doesn't hurt to reach out!

 Just me on the title... Sounding like my options may be thin and I just need to focus on paying down the balances. I know my FICO will shoot up in a month or two if I can get them down a ways, I'm just concerned with the days ahead in Real-estate. 

We are currently living in it yes and not much left in the reno, mainly finish the kitchen, master bath, and the doors & Trim. Other than that its done. Estimated costs are right around $17,000 to complete. 

Credit score is lower right now because of using my cards to finance a few purchases. I had to push to get the roof on before the PNW fall / winter.

Was mainly seeing if a lender would write my credit card companies a check during closing out of the cash out refinance money being that there should be quite a bit of equity in the home now?

Just using the stickied template here to be thorough. Looking for advice on how to refinance.

Your goals and story:

Purchased this home (my first house) with intentions to BRRRR in July 2019 for $280,000. The house came with a buildable second parcel with a water meter already on it, close to all other utilities. The home was a MESS. Everything except the studs, HVAC, and Plumbing were in bad shape (The bones were good) Cat piss smell, termites, leaking roof, rodent infestation, the WORKS.

So far I have been working on it with my girlfriend and occasional help from my Uncle who is a licensed contractor, and her father for the past year. I could go into a list of what we have replaced but its basically everything (Roof down to the insulation in the walls). We have only the kitchen, master bath, doors and trim left to do. I have financed everything out of pocket or with credit cards ($14,000 on those). I am basically running out of time and would like to cash out refinance prior to it being finished, so I can get the remaining projects done and my credit cards paid off, and get on to the next chapter (Buy a multi family or develop that second lot). 

This was my first attempt at real estate, I would do ALOT of things differently the next go around. Budget would be the first thing. I would say I have spent anywhere from 40-55k so far on this project, having unrealistic expectations out of the gate. 

Type of property: Single family home

Location of property: Washington state, Pierce county

Purpose of financing: Cash out refinance to finish reno, and pay down credit cards

Type of financing sought: Not sure

Current or prior ownership of real estate: This is my first house

Occupancy: owner occupied

Value of property at present and/or your offer price: $380,000 - $400,000

After repair value: $450,000 - $500,000

Anticipated or actual appraisal issues: Master Bath is not complete, kitchen is temporary but operational, missing doors, missing trim

Current rents per month: $500

Fair market rents per month: TBD

Down payment or equity: Looking to keep 20%-25% equity in property after cash out refi

Source of down payment funds, if applicable: N/A

Income Source: Full time employed for a specialty contractor for the same company, for 4 years 7 months. 

Gross monthly income (optional): $5,600

Monthly debt obligations appearing on credit report, plus (if applicable) personal rent and alimony/child support/etc: $575 (CC) $1979.15 (Mortgage) 

FICO: Bad, but zero missed payments, just high balances on credit cards

Credit issues: No issues other than high balances

Additional details: Just looking for advice on refinancing. I have heard with COVID they may do a drive by appraisal, but I have a feeling my FICO may be an issue. 

Thanks for any advice in advance!

Utility permits and site work can add up very quickly. They also take time to get done and permitted. If you can get a good tear down that pencils out, you are saving X amount of time, and time = $. You may also be able to get a remodel permit by saving one portion of the foundation or a bearing wall, which could potentially mean less money in permit costs.

On the other hand, if you can get a good lot with utilities close by, it may work out better. 

I think its really a case by case basis and you shouldn't rule out one over the next if you are looking at ground up construction.