Brrrr! Is refinancing easier when you buy cash?

[Devin Scott]

Hello all! So I am on the fence of quitting my W2 job and being my own boss in my family business (1099). Even though I am soooooo ready to get out of the corporate system, I am nervous it will hurt me when it comes to investing in real estate. I heard it is really hard to get conventional financing when self employed, but is getting a conventional loan considered the same as refinancing a home that is owned out right? If I can buy a house cash, fix it up, and put a tenant in place; can I cash out refi while being self employed or is it considered just as hard as getting a conventional loan to buy the property?

[Lee Ripma]

@Jeremy England I actually only use commercial loans. My props still cash flow with them and I think they are easier to get. None of the DTI stuff. I had a terrible time with conventional lending because they didn’t see that I’d added more value than what I’d bought for. I get commercial loans even on small properties. Here is another commercial loan trick I never here anyone talk about: I buy a 4plex with cash based on comps, I rehab it and up the income. Then I get it valued as commercial RE and take a cash out refi commercial loan. No seasoning as long as I’m not doing over 100 LTC. As long as the income is good and I’m in it all cash they don’t seem to mind giving me all or most of my money back. They look at the current asset and the other assets I have. At first I thought I couldn’t get cash flow with a 20 year am, but my underwriting showed that I would, and it’s true! So I always encourage people not to discount commercial lending-even on your first deal!