How to pull equity out of a subject to property?

[David Abarca]

I have a question for all the subject to people out there.  How do you pull your equity out of a property that is subject to?  I have a property that we took over payments of the loan on and it has a 3% interest rate on it.  I would not like to refi it since rates are around 7% as of this writing.  Is there another way or company that allows you to pull that equity out?

[Matt Devincenzo]

Technically yes you just get a 2nd position loan e.g. a HELOC/HELOAN.

In reality probably not...the issue will be that any lender you approach for the 2nd will ask about the first. When they do there will almost 100% be an issue in underwriting because of the loan not being in your name. Maybe its not a specific guideline, but it is definitely not what they typically see and they will likely not be able to move the file along. So that leaves you with private money 2nd, but then you're probably at 12%+ which makes the blended rate high enough that a cash out refi is probably a better option.