refinancing question

if i buy a house for cash and then refi on it within a month and pull out cash to put in my pocket, do i have to pay tax on that money that year? i have a house that i bought for 40k and im puttin 5k in work into it and it will be worth 75k. i would like to refi and take and extra 10k out for me, do i have to pay tax on this?

You don’t pay taxes on loans.

While a refinance is not a taxable event, your timeline may be a little too optimistic. Lenders I have talked to are requiring six months on title before they will allow a cash out refinance.

Rate and term refinance with no cash out can be done immediately, but it takes a little longer when you want cash out of your refinance.


I have to disagree with you here. While the lenders who will do cash out refinance with no title seasoning are few and far between, there are still some lenders out there who will do it. Generally you need to be able to verify employment/income, and assets and you’ll see a max LTV of 80% or 85%.

The thing I would stress to everyone when buying an investment property is have an appraisal done when you purchase. Regardless of whether you pay cash or use some kind of lender. The reason for this is two fold. First this will give you an appraised value to base on deal off of and second when it comes time to sell or refinance, then you have some documentation beside the HUD-1 to show an underwriter to establish what the market value of the property was when you bought it. This way you get less of the disbelief from the underwriter that the property increased tens of thousands in just a couple of months.

Just my $.02, for what its worth.