All Forum Posts by: Marc M.
Marc M. has started 25 posts and replied 71 times.
Post: How do I cash out 80% of Appraised Value on a Foreclosure Rehab?
- Architect
- Santa Monica, CA
- Posts 73
- Votes 24
Hello,
I purchased a foreclosure property at tax sale in Michigan in July of 2012 for $88.5K, and put $80K into the renovation with cash borrowed from family members. After the renovation was finished in January I went to my local bank to get a mortgage in order to pay of the cash-loans, and everything seemed to be going very smoothly to do a conventional 80-20 LTV (this home was to be my primary residence). The bank had the house appraised, and it was valued at $214K. My loan officer then sent my completed file to the underwriters and they kicked it back saying that I have to wait a full year from the date the deed was recorded in my name before I can cash out 80% of the appraised value. At this time they said I would only be able cash out 80% of the purchase price plus documented repairs. I have some questions I'm hoping the pros on this board can answer.
1) Can I put the property on the market and sell it to another buyer for appraised value or will they run into the same problem if they try to mortgage the property?
2) Is the 12 month seasoning period a law or just a common policy banks follow?
3) Are there any banks out there that would do an 80-20 LTV refi using the appraised value?
Any advice would be very appreciated.
-marc