gregorygarver.com

[Zig]

There are no pre-pay penalties on my loans and I own another home that I just refinanced to a 30 year fixed. My income is 202k/year and my total expenses (with both homes, credit cards, everything else ) are 123,000/year leaving another 50k a year in expendable cash. What are my options on refinance? Do I have to wait 6 months? How do equity lines work? I want to renovate my 1st home at a cost of 100,000.00 and I want to renovate the 2nd home at a cost of 50,000.00. How do I get 150k out of this situation? The 1st home has no equity in it. The 2nd has approximately 243k in equity.The 2nd home was originally priced at 769k. The market slowed and the owners had moved out. They only owed 75k on the house (retirees). That's how I bought the home for 507k. The appraisel which is backed by comparables is 750k. Again...how do I get money out? By the way...most people who are ex-bankers, ex-realtors, ex-anythings...should refrain from giving advice on a field they weren't qualified to make a living at. They obviously couldn't hack it and now have no valid info to contribute.

[BradS]

I assume you're in the United States.you're likely stuck in the mortgage mess. Lenders do not want any more loans with less than stellar terms.Your first house has no equity. You likely aren't going to get a renovation loan for it because the lender will be scared that it won't sell for what is already owed. [And you just refi'd into the 30 year fixed.]I do not know what "valued at" means when your closing purchase price is 507k and will be a public record. Lenders are already scared of inflated appraisals and it looks like you have no cash equity in the deal.So I'd guess that lenders will think the same about the second house, esp. as one of the two obviously isn't where you live and therefore is a speculative deal.***Thus, any loan at all will have to rely on the security of your income. It follows that any lender will be looking very hard at how secure your income is and will likely assume that a recession begins in 1Q 2008.Will you still be employed? Will your income stay up? [Is it all salary, or is part of it bonus? What part is rental income? etc.]***In summary, my guess is that you'll be turned down because you're loaned up in order to buy this second (rental) house and your income may not be assuredly stable.IF {big if} your income is plainly stable [you're a government employee or something] then you may be able to swing 150k in construction loans (two separate ones) with a transfer to a second mortgage after each construction is complete (a full guarantee backed by all your assets and income will be required).I doubt you'll like the interest rates quoted.It might be simpler and easier to finance the renovations on the second property yourself out of your annual cash flow and then rent it at a higher figure. With a lease in hand, maybe you'll be in shape to refi the second property on commercial terms for enough to do the same on your first house.looks like a three year project to me.