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PURCHASED HOME 7 MTHS AGO FOR $60,000. IT APPRAISED FOR $90,000. CURRENTLY OWE $53,000. CAN I REFI WITH CASH OUT FOR IMPROVMENTS?

by dunagantruck005178 from Jackson, Alabama. Feb 21st 2017 Reply


Tom Lewis (Tom@thamesjackson.com)
#15 ranked lender in Alabama - 15 contributions

If a property has been owned less than 12 months you will need to use the lower of the purchase price or the appraised value. In your scenario, that would be the purchase price. FHA does have a program that will allow you to refinance your loan (as long as it is your primary residence) and finance the improvements. You would then be able to use the completed or "subject to" value. Minimum credit score of 580. If you have further questions, please feel free to contact me anytime at 251-609-3770.

Feb 21st 2017
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William J Acres (William_Acres)
#2 ranked lender in Arizona - 7,933 contributions

More info needed.. but if your loan is FHA, you need to wait 12 months to go back to FHA.. If you go conventional, then so long as you have made 6 payments, you can refinance (rate and term).. and although you will be required to do an appraisal, the Loan to Value will be determined by using the LOWER of original appraised value or the new value.. you can do a cash out refi, and you would be going by TODAY'S value.. but to do this, you have to wait till you have made 6 payments, and you would be going by the NEW appraised value. (https://www.fanniemae.com/content/guide/selling/b2/1.2/03.html). I'm a preferred Lender with Arizona and California being my primary markets. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com NMLS# 226347 / RPM Mortgage NMLS 1541014 / AZMB0121893

Feb 22nd 2017
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