Cashing out - Rookie

Submitted by Berto from CA - 11/19/2009 - 9:37pm

I am buying a home via a probate sale, all cash. The cash is being provided via hard money, I plan on putting my cash into fixing the property up. The upside after the repairs is substantial and I would like to take out a mortgage and get the highest amount once the house is livable. I plan on living in this house for 5 plus years.

How would you recommend doing this. My offer is already accepted in my name.

Any insight would be appreciated!

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Comments

Submitted by Janet - 12/02/2009 - 1:26pm

Conventional Lenders will require ownership of the property for 6 months before allowing a cashout refinance, so if it depends on whether you are paying off a Hard Money Loan that is recorded as a lien, or if this hard money is a sort of "personal loan" to you. If no lien is recorded on the property, then you will be considered a "cash out" transaction, therefore the 6 month wait. I would also suggest that you document all repairs (photos, reciepts, etc.) if you are hoping the home will Appraise higher after repairs.

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