Does The Dodd Frank 10 Property Rule Apply To Cash Out Refi?

[Chris Sean]

Like the title says...Does it apply to cash out refinancing as well as up front financing?

[Kevin Romines]

Well there is a 10 financed property rule with Fannie Mae, however you can finance 10 in your name and 10 in your wife's name and get 20 that way? Also there is no limit on the numbers of financed properties when you are buying a new owner occupied home. So if you want more rentals, go buy a new owner occupied home and turn your previous owner occupied home into a rental.......No limits then. 

Also, if you want to finance as many Fannie Mae homes as you could ever want, then once you hit the 10 limits, go open a Sub S Corp. Not and LLC and move some of the homes you have financed with a Fannie loan, into the Sub S and go get commercial or portfolio refinance on them. By doing this you just opened up a few slots of Fannie Mae financing that wasn't there before.

Fannie Mae doesn't consider a home that is financed in the name of the Sub S to be a personally financed property. Even if you have to sign a personal guarantee on that commercial/portfolio loan, its still not considered a personal financed property by Fannie Mae. This will not work if the property is in and LLC and you own more than 25% of the LLC.