Help with my refinance!

[Aaron Henricksen]

I purchased a townhome earlier this month, and I'm fixing it up. I had to use a high interest private money lender, so I'm hoping to refinance sooner, rather than later. I'm doing repairs, but expect to be done by the end of the month. The current loan is $64,000, and the ARV is $95,000, based on an appraisal done about three weeks ago. My goal would be to do a cash-out refinance, so I can pull my invested cash back out for a successful BRRRR. It's not currently rented (as I'm renovating it at the moment), but I'm planning on using it as an Air-BNB once completed. If needed for the refinance though, it should also work as a long-term rental. Can anyone here help me out with a long-term, reasonable cash out refinance loan?

Thanks,

Aaron

[Eric Johnson]

Aaron, you have multiple hurdles you need to cross to make this a successful deal.

1. You have an ARV of 95,000. Minimum loan amounts for investment properties are generally $75,000

2. Since you're using airbnb, this is short term rental. Cashflow is hard to underwrite (based on historicals). I recommend not doing this if you want to refi.

3. ownership seasoning. You usually need at least 6 months ownership seasoning to capture the full valuation of the asset. Otherwise, it's usually based off of cost based rather than market value. Cost basis is purchase  price + dollar amount of any rehab. 

Hope this helps. Seems like a tricky situation unless you can use your personal income and go conventional.