Please help me understand this re-fi question?

Ok. I have a deal in place at 60% LTV. It’s a small deal: $27K purchase price, $3.5K repairs, CMA showing $55K ARV. I have contacted my HML in North Carolina and everything checks out except he insists no lender will refinance me out of the home for at about 1 year.

Furthermore, he says that if I try and retail the house instead, no lender will grant a loan to a buyer because the chain of title will show I only owned the house for a few months and then it would be considered a flip.

Can someone then explain to me how rehabbers are getting Hard Money to finance their projects and then either refinancing out of them or flipping for a profit once they are done. Because that’s essentially what I’m trying to do and I’m being told that no lender will touch me after the rehab.

I need to get this settled for a Jan 19th close. Any help, or feedback would be appreciated.

I Bought a SFH in August 06 Non-owner occuppied. Then refinanced for 100% of appraised value non-owner occuppied and cashed out the profit which was a $26,000 check in Dec 06. So it can be done, because I have done it. But there are very few lenders that do this. You will have to have decent credit and income. A 90% refinance with cash out is much easier to obtain.

I’ll let the HMLs answer your HML question.

Sounds like your HML is trying to control your actions with the house which of course impact his loan yield and duration. Check with local lenders and see if they will refi you in the short term or if there are any legal limitations on financing a new buyer for the flipped property.

I’d have to agree witih 71tr, it sounds like the HML is trying to maximize his return.

The truth of the matter is that investors can secure refinancing on recently acquired properties [there are programs that allow for less then 6 months of title seasoning, less then 12 months seasoning (using appraised value) and less then 12 months seasoning (using purchase price)].

Do your thing, there are lenders that can assist you with the refinance.


Scott Miller

I am refinancing a property right now and have only owned it for 3 months. There are very few banks that will do this and they are a pain to work with. You need good credit, you can go stated everything. If you can go full doc you can get more. They are out there.

also forgot to mention I have been running into a problem on mortgages less than 50k. Some lenders wont do them.

There are a few conventional lenders that will go as low as 30K, but you are right, they are few and far between (and non-existant in the HM world).


Scott Miller

The FHA guideline is 90 days. You should be fine to sell it after that. By the time you rehab and spend time marketing the home, and going through escrow you’ll be past 90 days anyway.

Read this:

Thanks everyone for your help. The HM lender has agreed to lend the money. I had originally planned to keep the property and rent it, but considering that I am having a hard time finding someone to refinance me under $50K, I will list the property after the rehab is complete in February.