Cashing out

OK guys, newbie here…
I have a deal for a house that is listed for $195,000.00 (its been on the market for 205 days). I could possibly get $185,00.00 for the house pretty quicky. Its a brand new home (2002) in a newer subdivision.
He will sell it to me for $156400.00. Now, if I went to a loan for this home, can I get alone for its appraised value (say $185K). So I would walk away with 29K. THis would help me in holding costs if it didnt sell quickly.

Is this what cashing out means? What are my options. Obviously a note on 156k is pretty high sence I already have my own mortgage payment for my home. This is a little over my head, but it looked like a good deal for either sale or rent.

please help.

not postive, but i think you can only do the loan for the " sale price" …and then you would have to do a cash out re-fi down the road to obtain your equity…some lenders wont let you do this for 6 mths, or a year…they like the loan to season a bit…im not a lender or banker, so double check…because there’s a good chance im wrong…

sybadon is right. Conforming loans will be based off of the purchase price or appraised value. Whichever is lower.

As far as refinancing to take the cash out. Most lenders want to see some seasoning. There are some that do not require any seasoning, but, their rates will be higher.

I am a loan officer in the Atlanta area that works with investors. There are a couple ways you can get cash out of a property. Like the others have mentioned, cashout refi’s are an option, just depends on which lender you work with. Some require seasoning some don’t. For the ones that don’t require seasoning, you pay the price with a higher mortgage, but if you manage the money properly you can pay that note with their own money till the property is sold or seasoned enough to refi with a lender with better rates.

There are some conventional programs out there that will allow you cash out at closing, but I would have to know more about you situation to know if you qualify for them. They generally are ment for people purchaseing homes needing some TLC that plan on moving into.

Hope that helps

Hello Newbie,

As a mortgage planning consultant that specializes in investment properties I can tell you that what you are looking to do is very common

Yes, what your are looking to do is a cash out refinance.

Other responses have been referencing to “seasoning” requirements. This is the length of time that you have held title to the property.

Don’t let this concern you though. There are plenty of lenders that have “NO” seasoning requirements and “WILL NOT” charge any more on the loan.