Buying a primary residence with equity

[Wendy S.]

Good Day everyone.

I would like to understand if my thinking to pull money back out after purchase is on point, flawed or get solution on how to do it.

PV $950,000

PP $805,000

DP $48,300 (6% $805,00) primary res

Loan $756,700

(Providing this is within the limits)

After purchase get a Heloc based on owner occupied 90% Ltv. So

90%*$950K-$756K=$99,000 Loan

Total Loan $855K ($756,700 + $99,000)

Is this doable, can be done immediately or require seasoning?

2nd option

PV $950,000

PP $805,000

DP $161,000 (20% avoids PMI)

Loan $644,000

Heloc

90%*$950K-$644,K = $211,000

Cash gained $50,000 ($211K-$161K)

Not sure about qualifying on the larger HELOC with higher repayment costs.

[Suzie Remilien]

@Wendy S. In this market, you are unlikely to get 90% LTV even with a primary residence HELOC. In addition to the lower combined LTV, credit score and DTI are the main factors to consider. Property valuation in the form of broker price opinion (BPO) will likely be required. A lender can speak to your specific scenario and that is why my comments are general. For example, I recently learned that some lenders will not do HELOCs on 3-4 unit primary residences. Max LTV was 85% for 1-2 unit primary residences.

Hoping other folks will jump in if I forgot something.