I am looking for a lender that will do a refi at a good rate for a property I bought about 2 months ago cash and have used cash out of pocket for the rehab. I own this property free and clear, have gutted and am in process of a near total rehab, and would like to pull my money back out when completed (in a few weeks). I need a refi lender with no seasoning issues who will loan to 85-90% of fair appraisal. I currently have a 6.75% rate being offered from Nat.City (which is where we do most of our loans), but they will only loan to 75%. I realize my interest rate will be slightly higher to go to 90%, but my contractor has run into some unforseen problems which are pushing us above our initial budget. I’m willing to pay slightly higher for a higher % of ARV, but I’m not desperate and am not going to be ripped off (ie-if you are with King Capital don’t bother contacting me). If anyone would like a top quality investor to work with (100K income and 740 mid score, experienced RE investor), let me know what you can offer on this property and we’ll give whoever we use a fair shot at all our other deals (refi’s and purchases).
Most lenders do not have any seasoning requirements for the normal conventional loans. That’s if your talking about a full doc loan under 85% on a 1-2 unit.
Here’s the thing…any broker can tell ya whatever you want to hear but without knowing all the details what they say has no validity.
You haven’t told us how many units or if you have liquid assests. Just because you have a good income doesn’tmean your assets haven’t been tied up into projects.
You also haven’t discussed how many properties you own.
It’s just unprofessional for peoplein this industry to just shoot out rates to you. You first need a consultation to address your goal with that property and qualifications.
Thanks for the reply, Ben, and thanks to those of you who emailed me.
Ben, you’ve spoken to my wife in the past on a couple other deals we’ve done, but we’ve ended up going with National City or not completing the deal in those instances. In the limited communication we’ve had with you, we’ve always been very impressed with you in that you seem to be a high quality, honest person, but I hate to feel like I’m wasting anyones time, b/c in the end, we’ll almost always go to the best deal. Just throwing that in, b/c I’ll happily give you all the info you want, I just don’t want to frustrate you if we end up not working anything out. You seem like a very good guy, I don’t want to waste your time. Going with a bank vs. a mortgage broker normally ends up saving us closing costs (we never pay more than 1 point) and interest rate (as I said, NC is at 6.75 for this loan to 75%, but will be higher if we go above 75%), but we get frustrated with the lack of flexibility of large national banks. It has happened in the past that just as we choose to go elsewhere, Nat City steps up to match or beat whatever deal we come up with.
We have 8 total properties, nothing larger than a 2-unit. Our cash is ALL tied up in other projects, which is why we need to refi one of the 2 properties we just bought for cash (65k out of pocket purchase +50K rehab costs). That pretty well takes care of any cash we had. Otherwise, it depends on what you consider liquid. We’ve got 80-100K in mutual funds/401K/Roth’s etc., but we have no plans on touching any of that.
Thanks for your thoughts, I appreciate them. Educating my clients (or the readers here) is something that I do like to focus on. Personally, myself, I’d rather be educated by someone than to have them try and sell me. Most investors are savy enough to know when someone is trying to mislead them or push a product. Unfortunately there are othes who dont know what’s available and will just take whatevers offered.
This loan should be just a standard conforming loan. Not sure why National City cant do this. That does not make sense unless I’m missing a key piece of info. You can have up to 10 properties total and with your income (assuming $100k should meet debt to income ratios) and assets (mutual funds/401K/Roth’s etc), a full doc loan would be possible.
You’re probably already aware that anything over 80% would have pmi. If you need 85%, a small 2nd mortgage can get you there but obviously the rates on the 2nd will be higher than on the first.
A couple things that will factor into the rate will be the loan size, type of property, and type of loan for your goal with the property.
Just curious…what lender will do a no seasoning cash-out refinance based on new appraised value on a rehabbed property above 75-80% in the conforming market? I would definately like to know for the future. Please email me if you would rather reply there.
Steve,
Ask Nat City if they will do a first to 75% and them maybe pull a HELOC 2nd to 85%?? I know there are banks that will do seconds to 85-90% with no seasoning on investment property.