Great News for Ventura County Real Estate investors. Fannie Mae has updated it’s guidelines to allow investors who purchase properties with all cash to refinance the property with Cash-Out Loans. Finally something to to help the housing market. I am sure Fannie Mae evaluated all the Cash purchases going on and saw a chance to get in on the booming cash purchase market. Since most deals are being done by all cash buyers who theoretically, have a stable financial position. This should free up cash for investors to purchase additional properties.
An investor-owner must meet the following conditions to get their money back and help with cash flow.
- The new loan amount cannot be more than the actual documented amount of the borrower’s initial investment in purchasing the property plus the financing of closing costs, prepaid fees, and points (subject to the maximum LTV/CLTV/HCLTV ratios for the transaction).
- The purchase transaction was an arms-length transaction.
- The transaction is documented by the HUD-1, which confirms that no mortgage financing was used to obtain the subject property.
- The sources of funds for the purchase transaction are documented (such as, bank statements, personal loan documents, HELOC on another property).
- All other cash-out refinance eligibility requirements are met and cash-out pricing is applied.
- Note: The preliminary title search or report must not reflect any existing liens on the subject property. If the source of funds to acquire the property was an unsecured loan or HELOC (secured by another property), the new HUD-1 must reflect that source being paid off with the proceeds of the new refinance transaction ?
If you would like information regarding financing or purchasing additional investment properties please contact our office at 805-499-7300 or email us at email@example.com