I have a deal that I can purchase for about 55% of the FMV. To move quickly, I’d like to purchase and cash out a little equity at closing. Does anyone have a HML that will do this since all the ones I’ve spoken to seem to against it?
what would you use the money for? repairs? then a HML should allow you to escrow some money earmarked for repairs. Otherwise if you just want cash to spend on something else, I think you’ll have to go another route then HML.
The HML I deal with base 95% of their decisions on the property itself and thats why you can’t take cash out. However if there isn’t any reason to use a HML, then just do a convential loan and get your cash out.
Think about it. If you find a house put no monye down and get $20k cash out at closing, you have no incentive to complete the deal. The HML can get stuck with a trashed house. That is why they don’t like to do that. I don’t know of any that will do it without escrowing the money. I have escrowed $10k and it only took me $6k to fix up the house (acting as my own contractor) and took the remaining $4k for my pocket.
I was working with a broker that dealt with a HML but was more conventional and would allow cashback to a company in the form of a marketing fee even if it was your own company. But you still needed to come into the LTV guidelines. Just call as many HML as possible. They are out there, though if it is not for repairs and you do not have a company, you may run into a roadblock. If you looking for cashout to cover the mortgage, then ask about rolling in 3-6months payments if you can still fall into the LTV plus all closing cost.
Remember HML are different breed. You can tell them what you want and they will decide, there is no blueprint of rules they need to follow, if they want to do something they can. No underwritter in a cube in Iowa deciding on your loan.