Cash Out Refinance Loan Suggestions

[Chris Smith]

Just using the stickied template here to be thorough. Looking for advice on how to refinance.

Your goals and story:

Purchased this home (my first house) with intentions to BRRRR in July 2019 for $280,000. The house came with a buildable second parcel with a water meter already on it, close to all other utilities. The home was a MESS. Everything except the studs, HVAC, and Plumbing were in bad shape (The bones were good) Cat piss smell, termites, leaking roof, rodent infestation, the WORKS.

So far I have been working on it with my girlfriend and occasional help from my Uncle who is a licensed contractor, and her father for the past year. I could go into a list of what we have replaced but its basically everything (Roof down to the insulation in the walls). We have only the kitchen, master bath, doors and trim left to do. I have financed everything out of pocket or with credit cards ($14,000 on those). I am basically running out of time and would like to cash out refinance prior to it being finished, so I can get the remaining projects done and my credit cards paid off, and get on to the next chapter (Buy a multi family or develop that second lot). 

This was my first attempt at real estate, I would do ALOT of things differently the next go around. Budget would be the first thing. I would say I have spent anywhere from 40-55k so far on this project, having unrealistic expectations out of the gate. 

Type of property: Single family home

Location of property: Washington state, Pierce county

Purpose of financing: Cash out refinance to finish reno, and pay down credit cards

Type of financing sought: Not sure

Current or prior ownership of real estate: This is my first house

Occupancy: owner occupied

Value of property at present and/or your offer price: $380,000 - $400,000

After repair value: $450,000 - $500,000

Anticipated or actual appraisal issues: Master Bath is not complete, kitchen is temporary but operational, missing doors, missing trim

Current rents per month: $500

Fair market rents per month: TBD

Down payment or equity: Looking to keep 20%-25% equity in property after cash out refi

Source of down payment funds, if applicable: N/A

Income Source: Full time employed for a specialty contractor for the same company, for 4 years 7 months. 

Gross monthly income (optional): $5,600

Monthly debt obligations appearing on credit report, plus (if applicable) personal rent and alimony/child support/etc: $575 (CC) $1979.15 (Mortgage) 

FICO: Bad, but zero missed payments, just high balances on credit cards

Credit issues: No issues other than high balances

Additional details: Just looking for advice on refinancing. I have heard with COVID they may do a drive by appraisal, but I have a feeling my FICO may be an issue. 

Thanks for any advice in advance!