Home Selling in Buford>Question Details

Gwen, Both Buyer and Seller in Buford, GA

I have a townhouse for sale - need I say more, I can't sell it - for health reasons I am having trouble with

Asked by Gwen, Buford, GA Mon Oct 6, 2008

the stairs - I have found the perfect ranch at the perfect price - I have $50K equity in my townhouse - Is there any way I can refi and get the equity to put down on the ranch so that I can rent my townhouse

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To do a cash-out refinance of your townhouse, several factors must be addressed. First, you would have to take your house off the market (no lender will allow you to refinance a house that is currently for sale and especially, if your are taking equity out). Secondly, you will be required to stay in your house for approximately 3 months after you have completed the refinance (most lenders require that you make 1 or 2 payments to consumate the mortgage and if any premiums are paid to assist you in the refinance, then the mortgage broker would be obligated to repay those premiums for a period of time, usually 3 months after closing). And finally, at the closing table you will be signing a document that says you intend to live in the house as your primary residence (not investment property) for at least 60 days (in the security deed), so if for some reason the lender were to audit the loan and find that you are renting the property , they could say that the equity. cash-out was done under false pretense and they could default the mortgage (declare it due and payable). If you were to try to do a cash-out refinance and tell the lender that you intend to buy another house and rent your home, the lender would tell you that the loan would be an investment property cash-out and most lenders are no longer allowing cash-out on investment property. You can still accomplish what you hope to do, just follow the rules and avoid problems down the road. Call me with any questions. Bob Wilgus: 770-313-1381.
0 votes Thank Flag Link Thu May 20, 2010
I am a Realtor in the Buford area and I know I could help you. Please contact me Reggie Pugh Solid Source Realty 770 363 6541
0 votes Thank Flag Link Wed May 19, 2010
I am a Realtor in the Buford area and have lived here all my life and would love to help you in selling your townhome? Please call me Reggie Pugh Solid Source Realty 770 363 6541
0 votes Thank Flag Link Sun May 16, 2010
I just sent about ten townhouse listings in Buford to a client. Yours may have been one of them.

I would not recommend refinancing right now because there is no way of knowing for certain how what kind of offers may come in. IMHO, refinancing at this time may limit your options so please consider your options carefully. And if I can be of assistance, please let me know as Buford is also part of my territory.

Solomon Greene
REALTOR® / Consultant - Keller Williams Realty Atlanta Partners
0 votes Thank Flag Link Mon Oct 6, 2008
Refinancing to pull out equity may be a good option for you so you can go ahead and buy a ranch. Keep in mind, if you refinance for the purpose you mention, the rate may be higher if the lender understands the purpose of the refi on the townhouse is to pull out your equity to use in the purchase of another home while at the same time intending to RENT the town house. It becomes an investment property when you decide to rent it out to someone else instead of using it for your primary home. My understanding is most investment properties are financed at a higher rate. However, the current rates may still be favorable. I would recommend you contact a lender you can trust to guide you through the process. If you are listed with a licensed realtor, they may be able to help you as well. Good luck. Janice Slaven/Prudential GA Realty
0 votes Thank Flag Link Mon Oct 6, 2008
If you are listed with an agent, ask how long homes in your subdivision are for sale before selling, and also at what price. If your neighborhood has foreclosures, you might consider installing an elevator or railing chair and waiting a few years for the economy to improve. If you must refi to move, recognize that lenders will make a refi decision based on current appraisal, so you may not have as much equity as you'd like. Also, I've been hearing from lenders within the last week that refis cannot exceed 80% of appraised value. This means you may not be able to pull out enough to make a deposit on the other home you've chosen. You should also ask your agent for the current rental rate in your neighborhood. Many investors are reporting rents have declined below mortgage and upkeep/repair costs, meaning you'd still have an out-of-pocket amount to pay on your townhouse even if rented. I wish there were better news all around, but hope this information is helpful.
Web Reference: http://www.AskAgentLisa.com
0 votes Thank Flag Link Mon Oct 6, 2008

Your scenario is a common but interesting one. By refinancing you are essentially stopping any legitimate sale of your home for some time. Sure, it might sell on the open market but the title issues may kill the deal.

No problem, you say you will rent it.

Keep in mind that your new rental unit still has a payment so that will be taken into account when qualifying for the next home.

Are you buying UP or Down? If you are buying up, it's less of a problem. However, if you are buying a home that on paper looks less expensive than you townhome, you might be buying an investment property according to the bank and need to put down the full 20%.

With "50K" in equity... You CAN sell it. Keep in mind that banks are not doing a REFI like they used to, (Market plus 3%).

I live and work in the area as well. Let me know if you need anything.
0 votes Thank Flag Link Mon Oct 6, 2008
Joshua Jarvis, Real Estate Pro in Duluth, GA
That is actually a GREAt idea. If you can qualify for the loan you will have a great start on a retirement income stream. Talk with a lender first, and a Realtor to find out about the local market values and trends.

And maybe a CPA to help you budget and look at the tax implications.

good luck
0 votes Thank Flag Link Mon Oct 6, 2008
Keith Sorem, Real Estate Pro in Glendale, CA

I work in the Buford area and would be glad to assist you with your Townhome situation.

A re-fi may be a good option for you if you can get a better rate than you curently have.

We also offer a guaranteed home sale program that I think you would qualify for that would allow you to pull out your equity and make an offer on your next home without any contingency.

Give me a call and we can set up a time to discuss your options.

James Dudley
ERA Sunrise Realty
0 votes Thank Flag Link Mon Oct 6, 2008
If you would like for me to try to help you, i will be glad to. My company has a Property Management Department that can lease and manage your townhouse for you if being a landlord is not something you would want to do on your own. It's a tough time for selling a townhouse and many people are renting. It could be a solution if you can work out the financial aspect.

Please contact me if you would like more information.
0 votes Thank Flag Link Mon Oct 6, 2008
Gwen -
I'm sorry to hear of your situation. You can reach out to Steve Chance at Wells Fargo for more specific information - 770-238-0211 or Stephen.B.Chance@wellsfargo.com

There are some tax ramifications as well as other things you should consider before making a decision.
I can also recommend a Realtor in the area who has been living/working in Buford for many years if you need someone to list your townhome or assist in your purchase.

Best of luck to you!

404 966 3247
Web Reference: http://www.leeadkins.net
0 votes Thank Flag Link Mon Oct 6, 2008
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