What are the current rules of NOO refinancing?

Hey guys,

I have couple of investment properties I am thinking of refinancing. What are the rules for NOO cash out refi? Got full docs, good FICO… I am not sure if cash out refi for noo are a thing of the past or some still offering it.


Cash-outs are still very much available on NOO properties. Keep in mind that for conventional (Fannie/Freddie) financing you will need to refinance the entire property. If you are just looking for HELOC’s or a fixed rate seconds you might try local banks. I was in San Antonio last week-end and saw that you have both Frost Bank and Prosperity Bank. Both of those state banks could help you with second liens.

Are there limits to how much you can cash out? does it matter what the reasons for the cash out are as long as its an acceptable LTV? Sorry, I didin’t mean to hijack the thread. :anon :shocked

Thanks Christopher,

I don’t really care to get second lien or full refinance, I just want to get my cash out of the properties. I will check frost and prosperity thank you :slight_smile:

Typically from what I have seen cash-out limits are set by individual lenders. On primary residence cash-outs I have had UW’s ask for a letter regarding what the cash-out is for, but I have never had an UW ask for a letter like that on a NOO property. Hope this helps.

It sure does, thank you :slight_smile:

I spoke to several banks today in SW Ohio and they all gave pretty much the same answer/requirements for my NOO 4 unit that has no mortgage.

Somewhere between 60-75% max LTV
Full Doc
No HELOCs available

It is difficult enough to get a HELOC on owner occupied property in todays market. What kind of rates were you quoted? Were they fixed or adjustable?

7.25% 30 yr fixed at US Bank. The had a 70% max LTV based on their own appraisal. Mind you, this is a straight cash out mortgage, not a HELOC.

Are the closing costs about the same as you would expect if you were getting a regular mortgage to purchase or is it different by doing it this way?

So far they are the same as a regular mortgage. That’s why I was hoping for a HELOC, but no luck so far. So far I’ve been quoted $2000-$2500 for closing which made me wonder if it was worth pulling money out at that cost. Then I realized it would have cost me that much if I’d done a regular mortgage to begin with.

Thanks for the reply. I was wondering if there were any advantages to buying in cash and then doing the cash-out refi (besides being able to do a quick closing). Guess it costs about the same either way.

If you close with cash and then do a cash-out refi, you would still have to pay closing costs for both transactions, wouldn’t you? I do recognize that the cash transaction would not be as expensive as when you get a loan, but you would still need to pay some closing costs…

It was about $450 for me to close cash.

Other than paying an attorney to draw up the documents I would not think there would be too many other costs. Although buying a house nowadays without title insurance is not recommended.