Cash Back at Closing?

I have a buyer who has $35,000.00 in equity in a home that he is buying in Texas. He wants to walk away with that cash at closing. Is there a legal way for a buyer to walk away with his cash at closing?

Not a lot of info to help with a answer. Is it Owner Occupied? What does appraisal indicate for value? What rehab is needed? What is credit score of buyer, how strong is buyer? Is buyer first time homeowner? Can’t wait a month or two to pull out cash?? What percent is the $35K of his purchase price?? email me, with more info, may there is a way to pull some or all out at closing.


dont get “buyer who has equity inn a house he is buying”

if it is a seller!! just refi and then sell.


It is possible to finance the contracted price for the purchase, with a second mortgage for the equity, all of which could be completed at closing, or take out a second on it after closing.

Good Luck!

How would this be done?

The buyer takes out a primary mortgage on the property, which usually is for the contracted price, but then also takes out a second mortgage or equity loan for the remaining equity of the property. Some states allow up to 125% of the value of the property, here in Texas, I “believe” you can go up to 100% of the total value of the property.


Property Value = $100k
Primary mortgage = $65k
Second mortgage = $35k (cash back to buyer)
equals 100% LTV

Or a HELOC account with a lender can be opened just the same, and only use the money as needed.

Does this help explain it?

Good Luck!

You would need a 1st for the purchase price and a 2nd for the equity? What are the mechanics of getting my cash back at closing out of the second mortgage? Does the title company need special instructions? Is there any part of this that is illegal?

The second mortgage would be paid to you by the title company, or bank if completed after closing.

The mechanics of it are legal, and done everyday in business.

There are lots of other options that are not at the top of the legal list that can be done. That’s where the creative financing comes into play.

I can not elaborate on those options, maybe someone else who doesn’t have a license can explain those to you.

I would reccomend finding a lender that has experience with this situation.

I did it . But, its not easy or quick. After closing apply for a HELOC. Very few banks will perform a cash-out refi or HELOC without 2 years of occupancy but they are bank that will lend.

Your best bet would be to purchase carletons sheets new course called “No down Payment real estate course” and he has a bonus section that shows you 13 ways to structure a cash back. I did it and it got me 60,000 cash back. I’m not an advocate of anything sheet writes or sells. But I speak from experience. ;D

thanks and godbless,

j ;

Be very careful!!! Most of those so called “ways to get cash back at closing” in these get rich real estate programs, amount to nothing less than loan fraud. They involve some trick or deception whereby the lender is deprived of certain material facts about the transaction, which if known before hand, the lender would not make the loan. I have purchased several of these “programs” and not one of the cash back techniques that I have seen, would not send the parties involved to prison, if the loan fraud is discovered.

I understand your concern and I thank you for your advice un the matter and for looking out for me. :smiley:

;)However I’m an attorney and I usually use other lawyers to close on my deals prior to doing anything that might fall outside of my view or misinterpretation.

The law can be subjective, but in regards to what you said, as long as your not doing something with the intend to fraud, or something which falls on an unethical characteristic; like take the cash back and not make your mortgage payments, other then that your fine and always consult a good honest attorney, lol I know that sounds funny but not all lawyers will work with you if it involves creative structure they mostly stay within the conventional guidelines of the law, why work hard for your client point of view.

Your main concern in most real estate transactions should be, tort actions that may be taken against you. Other then that I assure you Carletons is very well written. If you have any questions feel free to respond, Unfortuntely I cannot offer any legal advice. But I’m sure I can offer guidence and we can debate anytime.

Thank you and godbless.


As for the equity I’m really okay here in my market. See the prices have been fluctuating so dramatically that a Duplex which has an asking price for $300,000.00 a week ago is worth $400,000.00 to $600,000.00 today. ;D



Original Post:

I have a buyer who has $35,000.00 in equity in a home that he is buying in Texas. He wants to walk away with that cash at closing. Is there a legal way for a buyer to walk away with his cash at closing?

Answer: Yes.

Amazing to see people answer this without knowing what they’re talking about.

Kbrandau: This is not a second nor has anything to do with a second.

He wants cash not another mortgage.

This can be done.

It is legal and doesn’t involve any tricks. You just need to have the right information documented. Simple really.

I have been trying different techiques to get cash back after closing, is this legal? The person is selling the house for 80K its worth 104K I want to finance 95K and have the seller cut me a check for the 15K. Is the OK?

Getting cash back for example in the State of NJ is not allowed for 1-4 families but allowed on 4+ units. There are many other strategies which would benefit you just as much as getting cash back at closing if buying a 1-4 units.