CASH OUT REFI on paid investment properties

[Fred Gonzalo]

Hellp BP World!

 Looking to see if anyone has experience and what the avg numbers are for cash out refi on rental properties owned free and clear.

I am in New Jersey ..does anyone know a good small bank I can get in touch with that are reputable.?

I have property free and clear with tenants providing good cash flow...I wanted to see If i can refi one of those properties and use the cash for a new property im looking to get. And whats a good number..  ex... 75% of what house appraises for..6% intrest for 15 years?

Should the underswriter have a easier time with this project rather than a reg home mortgage? 

Thanks so much.

[Scot M.]

Hi, Fred. You are exactly right. You can generally expect around 75% LTV on a rental. You can then use that as down payments for another couple of properties. You may also consider a line of credit on your rental property that will allow you to only pay on what you use...meaning if you take out a line of credit for $50K but only end up needing $20K, you then 1) only pay back the $20K you used, 2) can make interest only payments at any point, and 3) still have $30K available in case you need it for repairs or to get rolling on another property.