BRRRR Ohio - Lenders or Credit Unions or Brokers, Oh my!

[P.J. Bremner]

So I'm currently in negotiations with my first couple of properties in Ohio and I'm looking to implement the BRRRR strategy. I have a couple great candidates for property management, an awesome contractor and a very knowledgable agent. The one piece of the puzzle I have yet to figure out just yet is the financing part. I'm purchasing these properties cash, rehab in cash and would like to pull the equity back out with cash out refi (unless there is a better way to do it?)

Can anyone with experience in Ohio investing chime in here? Should I look for a direct lender? Call a bunch of credit unions? Deal with brokers? I've got experience with each of these in my home state (southern California), but not exactly sure if things are different out that way when it comes to financing. Most of what I am looking at has an ARV of over $100k, so no, I don't need a lender to lend on that $40k turd (not that I wouldn't be open to it... just not for my first few properties). Thanks in advance!

[Chris Mason]

Originally posted by @P.J. Bremner:

@Chris Mason

Great advice, problem is I have not really spoken with many people that lend in that area.  I'm sure I could find a good reference or two on here.  Also, can you confirm the 6-month wait period from cash purchase to cash out refi?  Is there any workaround for that?

 If it's a true cash purchase, you can use the Delayed Financing Exception. Dial for dollars until you find a lender local to the real estate that can spell "Delayed Financing Exception" without the use of google or a spell checker. :)

A true cash purchase isn't one wherein you trick the seller and actually use Hard Money Jack's HML to purchase, it's one wherein the purchase was made using...

- Money that was sitting in the account for two months.

- Money that you can fully source and paper-trail, such as by lining a $155,322.58 deposit up with a settlement statement from a home you sold that netted you $155,322.58. 

- Borrowed money that is secured by an asset, most commonly real estate. HELOC, for example.

- No "mattress money" deposits, or down payment gifts from your friend Bob (Fannie Mae says that gifts can't be used to purchase investment properties).

Most FNMA DFE cash out refinances I do, I was involved before the cash purchase. Most of the time when I wasn't involved prior to purchase, and am approached after the fact, some guideline or another trips up the investor trying to do FNMA DFE.