Pulling equity out once property has been purchased

Hello all,
I wanted to know is it possible to purchase a property that has a lot of equity in it, then immediately turn around and refinance it to pull the some of the equity out to use as back up to make the monthly payments in case I am unable to place a tenant in there ASAP or the Tenants default.

I called traditional banks and they said that could not be done because you have to have the property for at least 12 months. I am planning on using private funding to purchase my properties so I am not sure if the seasoning issue still applies. I just need to be able to immediately refinance it to pull equity out


You can do it. I know builders that do it all the time. You just need to call around and find somewhere that will do a double closing. Don’t go to the big banks, contact a local guy, I’m sure there’s a company that advertises nonstop about how they can “Get the cash you need now, so you can take that vacation or pay off those high interest Christmas credit card bills”.


I have done exactly what you are asking twice. Once on an owner occuppied property and once on a non-owner occuppied property. Unfortunitely both of the lenders I went through no longer offer this option. They now have the seasoning requirements that you are speaking about.

I think EZLoans knows of lenders that still do such a loan. There aren’t very many that will do a non-owner occuppied refinance with no seasoning, but he knows of a few. You have a high credit score so that will really help.

Be careful about doing this. Try to avoid spending your equity if at all possible.

Let me clarify a little. You can do a refy right away if you rehabbed the property. But to refy just because you bought a great deal is difficult today.

Ok I got you. Thanks I’ll check with EZ Loan.

I am willing to do the easy cosmetic rehabs like carpet and paint, I wonder if that would qualify as an official rehab in order to refinance like a month later to pull the equity out.

Any thoughts?


The question should be what will happen to my cash flow when I refi and take out the equity? The answer is usually that you will have a negative cash flow even with a tenant paying the rent!


Exactly!!! I agree.

The more I do Real Estate, the more I like the idea of paying my properties off. If you pull money out of one in order be able to buy a different property then that is fine. But make sure you never touch the money. Have your mortgage officer pull out the equity from one property and put it right into the new property as a down pmt. But I would only do this if you have to do it.

This is true but I don’t plan on using the money…only to keep it in a HYSA for just in case purposes only. If I am able to rent the property right away or have good tenants that always pay then when it comes time to sell it the money will be available to be placed back.