Refi Question

I heard yesterday that I cannot refinance my flip for 1 year after Ive bought it.

Is there some kind of new rule due to the mortgage meltdown??

My plan has always been to sell some flips and keep some as rentals. Now I get word that I cant refinace in order to get the hard money guy paid for a full year.

Please advise.

ReiRay

Comments(5)

  • NewKidInTown313th November, 2007

    Rate and term refinance can be done immediately with many lenders.

    A cash out refinance, however, does have a title seasoning requirement from six months to one year depending upon the lender.

  • finniganps13th November, 2007

    Have you considered a HELOC to pay the hard money guy - the cost of a HELOC is probably cheaper?

  • linlin13th November, 2007

    I spoke to several mortgage brokers and also a couple of banks today and the consensus is that unless you have a 720 or better the chances for a home equity loan are slim.
    Cash out refinance was what most recommended.

  • reiray13th November, 2007

    Thanks everyone for your help..
    linlin..
    So...heres the scenario... I bought a REO property and am putting about 18- 20 k into it bring it back to market value. There are no seasoning issues in refinancing (Cash out refi at new market value ) within 1 month of finishing rehab??
    I just want to be absolutely sure. Ive also talked with some mortgage brokers and some say yes...some no.
    Thanks...

  • ypochris13th November, 2007

    Some lenders have no seasoning requirements in this situation- or at least that was true a couple months ago...

    This has been my business model- buy with borrowed money, rehab with borrowed money, then immediately refi to repay loans and purchase next property. Essentially totally cash out loans as prior loans have different property as collateral. It has worked so far. Renting the property first can help make the financials look better.

    Try different mortgage brokers, explaining the situation. They can immediately tell you if they have a product or not. You could also try small local banks or a credit union if you are a member- I have not done this but others have had good results creating a relationship with these.

    Chris

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