Cash Out Refi Vs Equity Line

I have a rehab project that I just finished and had appraised for the cash out refi. We are talking to two different mtg companies and are getting two different programs thrown at us. I plan to rent the unit out.

1. A non-seasoning cash out refi at 90 % LTV at about 6.75% I/O.

2. The other mtg company says it cant do a non-seasoning cash out but can do an investor loan with no pmi at 6.25% P & I with an equity line up to 30K. (the cash out amount was going to be about 35-40K).

Closing costs are about the same on both. Rate on the HELOC is prime.

Which is the better way to go? Advantages? Disadvantages?

Suntzu18

Comments(3)

  • roboxking16th March, 2005

    I think this post may be in the wrong section.

  • suntzu1816th March, 2005

    What section should it be in?

  • roboxking17th March, 2005

    Try dumping it in the "Bird Dog / Beginners Forum."
    I would probably go with the option that give me the best net cashflow. But need more details.

    Any call periods? how long you plan on holding property? HELOC & income Tax... Any other restrictions?

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