Apprasier is driving me nuts, opinions on whether I should cash out refi or not.

[Mark Ferguson]

I was going to do a cash out refi on one of my SFR rentals with my portfolio lender. I bought the house for 92k, last year and put about 20k into repairs. I am a Realtor and know the market, it is worth at least 155k, probably 160k in todays market. I have it rented for $1250.

The appraiser came I at 136k! The appraisal is horrible. He gave my house a condition rating of C4 meaning it has not been updated in the last 15 years and needs maintenance. The house has refinished hard wood, new carpet, new baths, refinished cabinets, new appliances, new paint, new 6 panel doors, new lights, fixtures, door handles etc. Brand new AC and new sprinkler system.

He comps were a dated houses that had never been updated and he said it was a C3 and deducted $7500 off my value. A fix and flip that was really nice, he said it was C2 and deducted $15,000 and a very dated house in much worse shape than mine that he said was C4 and did not deduct.

One of those comps is on a busy four lane road that he deducted nothing for. two of the comps have 2 beds and 1 bath up while mine has 3 beds and 2 baths up. He added a whopping $2,000 adjustment to mine for have another bed and bath.

My portfolio lender sent all this info to their appraisal department who sent it on the appraiser and he said, sorry I'm sticking by my value. I then got pissed and sent a very professional email stating all the work I had done and why I thought he should look at the value again. It was very nice and I sympathized with the regulations they have to go through. He never responded.

SO my choices are to continue with the refi at 136k which be

Closing costs: $4,480.94

Total Cash back to you: $25,913.38

It would be a 7/30 arm at 3.62% and not lower my rate any. The reason to do it would be for the cash to buy more properties. I am getting about a 24% cash on cash return on my rentals.

I could refi another one, but then I have to pay for this appraisal still and I may run into the same problem again. I'm thinking I should just do it to get the cash so I can buy more properties. Any thoughts?