Cash-out refinancing in Texas

[Nitin Dhiman]

Hello experts,

I'm trying to do a cash-out refinance of a single-family rental in Texas. The property has been rented out for the last 4 years and I live in California. I'm being told by some conventional lenders that Texas doesn't allow cash-out refinancing of a rental if I don't own a primary residence in Texas. Something about Texas (a)(6) rules (?).

The issue is that only 2 out of 8 banks I've spoken to are aware of this, while the others can't confirm. I don't want to spend weeks in an application process if there's a chance that I'll run into this with underwriters at some point before close.

If you're familiar with this problem, I could definitely use your guidance.

Thanks!