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Refinance a rehab house for cash out

I bought a fixer-upper property a little less than 2 years ago for around $325,000. Repairs are finished but we incurred more costs than we had anticipated. The whole house was replaced and is estimated via comparables to be worth $390,000. We were looking to refinance to get a small cash out ($5,000) to fix some debt. Are we stuck with the proposed house value? This is our only proprety. by shanno_324_125 from Tampa, Florida. Nov 3rd 2011 Reply


Aaron Clowes (AC4Mortgage)
#466 ranked lender in California - 5 contributions

you are over 12 months seasoning so current value will be used

Nov 3rd 2011
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Lynne Rohde (TeamRohde)
#93 ranked lender in Florida - 4 contributions

I would need more information to be able to answer your question... feel free to call or email me! Many thanks! LynneLynne Rohde - Over 25 years of experience!Originator NMLS # 263475Mortgage Professional - FHA, VA, RURAL HOUSING AND CONVENTIONALE-mail me: LMRECO@aol.comCall me: 407-667-4886Fax me: 407-650-2921Apply on-line: Lynne's Web SiteFriend me: Lynne's Facebook1800 Pembrook DriveSuite 300Orlando, FL 32810

Nov 3rd 2011
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Lee Eisenberg (lemort)
#66 ranked lender in Florida - 1 contribution

Hi, the original value is only used when you look to refinance within 12 months, outside of that they will go off current market value. Certainly all the improvements will help with the new value as well. As for cashing out, you don't say what you borrowed, but cash out could certainly be done, but keep in mind that different loan to values have different price adjustments for cash out versus no cash out. I'd be happy to speak to you in depth.Thank you

Nov 3rd 2011
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Bert Carpenter (BertCarpenter)
#39 ranked lender in Arizona - 1,731 contributions

Based on the time frame you have owned the property you are in luck. Generally, once a property has been owned for one year, lenders will consider the home's current market value as determined by an appraisal. The appraisal will consider the surrounding comperable properties in the value determination. One of the factors the appraiser should consider is the recent rehabilitation, which should help improve your value.

Nov 3rd 2011
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 4,620 contributions

You can refinance however I'm not sure how much sense it makes to pay the the costs for a refinance only to pull out $5000. You might want to get with a local mortgage broker, not a bank, and have him look at all the details... he'll be able to guide you to the right loan product for your particular situation.. WilliamAcres.com

Nov 3rd 2011
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Stephen McWilliam (StephenMcWilliam)
#143 ranked lender in Florida - 33 contributions

An appraisal will be required and maximum allowable loan value will be based off of that valuation. Your current credit, income and debt service will then determine what the actual allowable loan limit.

Nov 3rd 2011
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