Delayed financing: how does it work during a brrrr?

[Jesse Soriano]

I have enough cash to buy a property straight up and then I will be using my credit cards to do all of the rehab.

My question is how does delayed financing truly work?

I don’t want to wait the 6 months once I finish the rehab. If so, if I get a cash out refinance. Do I get back my money from the purchase price of the home or do I get back my money from the total after repair value if I choose not to wait the 6 months?

(I know I only get back 70-75% back)

[Ron H.]

There are fannie mae rules for delayed financing, for resold loans.  The most you can borrow is the original purchase price plus closing costs.  Purchase at 100K, 5K closing.  Put another 100K into it.  Still the largest loan you can get is 105K.  I've used delayed financing twice now with two different lenders, but these properties required less than 10% refurb cost to get a much larger appraisal number, so I was able to get everything back except my 10%.