Stuck trying to get equity out of primary residence

[Gary Price]

Hi,

I currently own my primary residence free and clear. It is worth about $1.6M and located in Southern California. I have been flipping houses for about 4 years but want to remain in this property longer and start a new business. Unfortunately. I'm running low on cash reserves and don't want to tap into my IRA and pay penalties. I have been trying to determine how I can get some cash out of the house seeing as I have 100% equity. I was only thinking of about $200K, 12.5% equity in the house.

The big problem I'm finding is that I have been showing hardly any income for years as I'm semi-retied and have been making money on the house flips and therefore have capital gains but no income. I have a very low rental income per year of about $20K from when I vacation rental my house out in the summer.

Are there any loans out there that are granted purely upon the equity available on the house when the applicant has next to zero regular income?

Many thanks,

Gary.

[Chris Mason]

Taken to the extreme, I have a gal that flips houses for a living. ALL of her income is cap gains. She uses fannie mae financing on probably 70% of her deals. This is possible because every year: her, her CPA, and I, basically haggle three ways over what her tax returns are going to say. 

It's a productive sort of haggling, not an adversarial one. She doesn't want to pay more taxes than necessary. I want to make sure she can accomplish her goals for the upcoming year. CPA wants to avoid tax fraud. So sort of a checks and balances thing.