Refinancing problems - Do I have to wait a year?

[Yoni R.]

I have a few new properties that I bought in cash and I wanted to refinance them now and roll the money into new properties. Pretty much the BRRR method. The only problem is that the mortgage broker that I am working with said that I have to wait a year before I can refinance them. Is this really the case?

To be more specific she said that I can refinance them now for 75% of the purchase price or wait a year and then I will be able to refinance them for 75% of the appraisal price. The other option is HML but they are asking for 9%+2 points at 75% of appraisal...

I would love to hear what our experienced BP members recommend doing? What is my best option? What should I do?

Thanks!

[Chris Mason]

Originally posted by @Yoni R.:

I have a few new properties that I bought in cash and I wanted to refinance them now and roll the money into new properties. Pretty much the BRRR method. The only problem is that the mortgage broker that I am working with said that I have to wait a year before I can refinance them. Is this really the case?

To be more specific she said that I can refinance them now for 75% of the purchase price or wait a year and then I will be able to refinance them for 75% of the appraisal price. The other option is HML but they are asking for 9%+2 points at 75% of appraisal...

I would love to hear what our experienced BP members recommend doing? What is my best option? What should I do?

Thanks!

 Hi Yoni,

It's actually six months before you can use appraised value without restriction, not 12. But there may be overlays.

And in that first six months, using the 'delayed financing exception,' you can go right up to the purchase price in terms of loan amount, if and only if the appraised value puts that at the needed LTV (eg, you purchased all cash for $100k and the appraisal is at $140k). See above about overlays.