All Forum Posts by: Alejandro F.

@Chris Mason thanks for the reply!

Hello All!

I'm looking for some insight into how a change in the loan amount impacts the loan point %. I am in the process of doing a cash out refi on an investment property. In the process of refinancing and after the rate was locked, the loan points increased .81% between the original estimate and the latest estimate. Here are events that have occurred during this refinance:

• Original estimate was based on a loan amount of $101k. The final loan amount went down to $78k.
• Rate lock extended from 30 to 50 days.
• Credit score did not change
• LTV of 75% did not change

Would any of these events trigger an increase in the loan points charged? 

@Jonathan Pflueger, thanks for the reply and insight! We've decided to hold off on building the ADU for now until appraisals are closer to the cost to build.

@Dan H., thanks for sharing that example. My concern is having $100k-$150k tied up in an ADU and not being able to pull those funds back out quickly to continue investing. I may sit on these plans for a while until appraisals start to come in closer to the actual cost of ADUs.

Hi All!

We are in the process of building an ADU at our primary residence. In our area in San Diego, it seems like there are ADUs popping up all over the place! However, there are no comps in our area to help gauge the future value of our home with an ADU. Our strategy is to build the ADU and do a cash-out refinance to pull out as much equity as possible. Being able to pull out 100% of the cost of the ADU would be great, but we understand this may not be realistic.

Does anyone have any experience with ADU appraisals they can share?

Well done! Best of luck to you!

@Matt Whitney, Airbnb is a strong option. As Airbnb Superhosts, we have had a great experience short term renting part of our house. It has led to having our home cash flow positive. Feel free to PM me if you'd like to discuss short term renting in greater detail. I'd be happy to share our experiences and lessons learned.

Another option is renting out rooms on a longer term basis.

I wish your Father the best of luck and I hope it works out!

@Ryan Cleary

You can do Delayed Financing and avoid the seasoning period. However, there are very specific requirements that must be met (see Fannie Mae delayed financing requirements). Delayed Financing loans are essentially treated as a cash out refi loan. Hence, you may see a higher interest rate and lower LTV than a standard, conventional loan. I'm in the process of doing this myself. One challenge I've found is actually finding lenders that are familiar with delayed financing.

Zach,

Thanks for the response! So if I understand correctly, you've been able to purchase cash, refi into a rehab loan, perform the rehab and, after the 6 month seasoning period, do a conventional cash out refi?

If so, how much capital are you able to pull back out with the rehab loan and based on what parameter? (appraised value, original purchase price, purchase price + rehab investment, etc.)?

I am currently looking to invest in properties in the Tampa Bay area (Florida). My primary strategy is to BRRRR these homes and pull back out as much capital as possible from the deal. I plan to purchase cash, rehab and refinance as quickly as possible/allowed. As I continue to research finance options, I see delayed financing as the way to quickly pull capital back out, especially if I can have rehab costs included in the settlement statement.

In the era of COVID, has anyone had success with delayed financing or other financing strategies that allow one to pull all or some of the capital back out of a deal?

Thanks in advance for any insight you can share!