Title company will not insure investment property cash out refi

[Roger Matthews]

First of all, i want to thank everybody in advance. I am grateful to find this forum because my family has been in extreme stress over the past few weeks.

Background is that we relocated from Houston 1.5 years ago to Chicago for my job and decided to rent my personal residence back in Houston. Now, we are trying to buy a house in chicago so we decided to do a cash out refinance on the house in Houston. All went well and we got Clear to Close on our investment property loan. We were told since it's the only property we own in Texas and it is a cash out we have to close in person in Houston. Me and my wife flew to Houston thinking it will be routine signing event and we will be back in the evening. Once we got to the title company we were told closing will not happen. The reason we were told was since this is our only property in Texas, it is considered a homestead thus requires home equity transaction not the investment property. Simply put the title insurance underwriter won't insure title for our property as an investment property. The lender on the other hand will not change the mortgage since it is rented and not owner occupied. Needless to say we had to come wondering what just happened. Now, our mortgage broker has a new title company but I am afraid we will have to same issue. What little research i did told me there was no way to get around it. Then i came to this forum and saw there were others who had the similar  issue. I am requesting to please help me out and let me know if there is anything we can do to close this transaction. I will greatly appreciate your help and feedback. We are desperate.

Ps. Someone mentioned T41 endorsement. Can that help in our case to satisfy title insurance company? 

[Jay Hinrichs]

well just remove your homestead since its not your homestead anymore.. ???

also i have never heard of having to be present at a closing.. that is not necessary at all.. I am not sure who told you that one.  The title company will either have an affliate they will send you to where your at in Chicago ( same underwriter usually) or hire a mobile notary service.. 

these are quite strange .

@greg