Unable to Cashout Refi because of grant on property!

[James Hunt]

I purchased a single family home 3 years ago for 48k I was able to get a "grant" that provided 15k used as down payment assistance. I put down 3k. My total mortgage on the home is for only 30k. The home is now on section 8 and I receive $750. I'm very happy about that. I was in the middle of cash out refi on the home to pull money out to use as a down payment for another home similar to the 1st unit. However, the bank was unable to proceed because of the 15k is actually a 2nd mortgage/or lien on the property for 5 years that just says I can't sell it. ( I never intended to sell) Thoughts on how I can get some cash to use for down payment on my 2nd home since the cash out option was eliminated???