Cashing Out --Yeah right! - Posted by Kathy

Posted by CarolFL on April 22, 1999 at 06:48:52:

Kathy,
We have gotten 80-85% cash out refi’s on 1-4 units recently. If you need it, keep trying.

One was from Southtrust bank, another was with Headlands, and the third was originated and sold the same day by a local mortgage co.

Carol

Cashing Out --Yeah right! - Posted by Kathy

Posted by Kathy on April 21, 1999 at 13:16:05:

All the guru’s and people on this board talk about getting a mortgage on the equity on one of your investment properties to buy another. Sounds great. We have a duplex, paid off, worth about 90k. Would like to get a mortgage against it–all we want is 40k tops. Should be easy right? It’s called “cash out” and the banks don’t seem to do it unless you are living there (homesteaded). Even if our son is living there and it’s homestead classification, that doesn’t count.

Anyone EVER had any luck doing this? Minnesota is not landlord friendly, and I’m beginning to believe it’s not investor friendly either. What on earth do they have to lose on a deal like that?

Any ideas short of living there?

Re: Cashing Out --Yeah right! - Posted by JPiper

Posted by JPiper on April 22, 1999 at 12:25:38:

Maybe Minnesota is the only place is the US you can’t do a cash-out refi.

Or maybe you’re dealing with an incompetent mortgage broker.

Or maybe you got your facts wrong.

I’d do more calling to determine which of the above it is…but my bet is that it’s #2 or #3.

JPiper

Re: Cashing Out --Yeah right! - Posted by Jim Rayner

Posted by Jim Rayner on April 21, 1999 at 14:24:11:

Kathy,

i just completed 6 cashout refis last week to purchase another 10 unit multi with 400K upside potential in it. and i’m working on cashing out 3 more properties right now. I did these with my mortgage brokers not my local banks. They are easy call a mortgage broker or contact Karp he helped me out with 3 of the 6 i just did. Karp@karps.net

Re: Cashing Out --Yeah right! - Posted by Kathy

Posted by Kathy on April 21, 1999 at 16:13:14:

I was just on the phone to a mortgage broker when I read your reply. It seems this is a Minnesota thing. they will give 65% MV with 10-11% interest with a 2-3 year arm. Then interest goes up every 6 months after that. no thanks. Looking into a 2nd mortgage on our homestead. That’s fine for this time (interest still high - 10.25%) but what about next time? They are not making it easy at all for investors. They’ll only give 80% on investment property, then of course the 2500 or so in closing costs.

Guess MN is not the place to try and invest in real estate unless you have 10k sitting around. I’ve read about all the other people on this board doing well, but I’ve exhaused by resources. Hard money lender is out–may as well refinance my car as to do that.

Re: Cashing Out --Yeah right! - Posted by Frank [Pgh PA]

Posted by Frank [Pgh PA] on April 21, 1999 at 21:12:36:

I get 75% LTV’s on SFR’s through my mortgage broker…don’t know about multiple units [I don’t do them] but would expect they would give less on those.

Re: Cashing Out --Yeah right! - Posted by phil fernandez

Posted by phil fernandez on April 21, 1999 at 19:14:40:

Kathy,

Jim has bought 31 and soon to be 42 units within a year by doing this. I would not be so flip with his advice.

I know he is doing this. I met him at the convention.

Re: Flip? - Posted by Kathy

Posted by Kathy on April 21, 1999 at 22:50:05:

Sorry if you felt I was being “flip”. Hope Jim didn’t take offense as you obviously did. Please read my response again, I don’t see that I’m bashing him at all. I’m glad it’s working for other people and was thankful for Jim’s response. I look forward to encouraging responses such as his and the others that have replied, especially since I was feeling particularly discouraged right at that moment after being on the phone with bankers all day.

Encouraged enough to try another local mortgage broker; and - lo and behold - they say I can get 75% appraised value 7.75% interest at 10 to 30 years. Said they obviously work with different bankers than the other mortgage broker I talked to. The first broker said even though they deal with out-of-state bankers (they got us our own home mortgage from an out-of-state) the loan is originating in MN and that is what governs the no “cash out”.

So, don’t know how the other broker can do it–but don’t care. I’ll deal with whomever can/will do it!

Re: Flip? - Posted by Jim Rayner

Posted by Jim Rayner on April 22, 1999 at 18:57:05:

Kathy,

no offense taken…glad to hear you tried and found another mortgage broker who had the right programs. I know that financing can be frustrating especially if you take a deal to the wrong source…i’ve been there and done that.
good luck with your deals!

jim

not flip - Posted by Gator

Posted by Gator on April 22, 1999 at 09:06:39:

Kathy,
I didn’t think you showed any disrespect and I certainly wasn’t offended. I wish I could give you more tangible help but all I can offer is encouragement. Last time I needed some money I went to my banker and by the time we were done he was telling me how they wanted my busines and if there was anything they could do for me just call cause they new I could go anywhere and borrow money secured by real estate. I usually set it up as a credit line so I can use the money anytime, closing cost are $400-500 and they’ll loan me 80% of value. If it helps my bank is Union Planters. They’re right down on the square across from the courthouse. I really can’t imagine why you’re having problems. Maybe it is like you said and Minnesota is a little different. I aint never been there but I have seen them football games with people in the bleachers wearing caps with horns on em like a bunch of simmental bulls. The only advice I can give you is to keep lookin but don’t look in Wisconsin. At their football games, they all have a big chunk of cheese on their head. No telling what the bankers there want.

Best wishes and keep tryin,
Gator