Cash-out Refinance Appraisal Question

[Nicholas Goode]

Hello, 

Brand new to the forum so please be gentle.

Just purchased a home as a cash buyer with the intention of doing a cash-out refinance within weeks/month of closing on the new home.

The mortgage banker I have spoken with has a cash-out refinance option that will work for my needs and is offering up to 75% of the appraised value.  Here is where my questions begin.

This home was purchased as a foreclosure and is not move-in ready.  The previous owner was living in the home but it is in need of various repairs/renovations.

Can anyone provide details or a link to a reference that will help me understand how an appraiser views a home in my situation?  Technically a tenant could live in the home today.  There is heating and cooling, running water, working bathrooms, roof is in great shape.  I will be gutting the kitchen, gutting the bathrooms, electrical upgrade, new flooring throughout, and dealing with water damage in the basement.

I want to make certain that when I apply for the cash-out refinance I understand what the appraiser is going to expect before he will approve/lend money on this home.  I need to make sure the appraisal is successful and the bank approves the loan.  It may sound strange, but it is not the amount of the appraisal that concerns me.  I just need to know what they consider as livable or lendable when it comes to the condition of a home.

Any assistance would be greatly appreciated and I'm glad to have found this forum and community as a future resource.

Thank you,

Nick