I was just talking to absolute mortgage. It appears that if one buys a property with cash, and then wants to cash-out refinance (assuming the property qualifies), there is a 6 month waiting period before you can get the loan.
Anyone know why?
Also, I’m seeing places will do a maximum LTV of 70-75% on an investment.
Not sure about the 6 month waiting period. However, I do remember reading something about the tax consequences of mortgaging a cash-purchased home. For IRS purposes, I think the refi is considered a 2nd mortgage with limited tax deductibility. You may want to research that if you’re counting on deducting the mortgage interest.
[quote=DataAgent]Not sure about the 6 month waiting period. However, I do remember reading something about the tax consequences of mortgaging a cash-purchased home. For IRS purposes, I think the refi is considered a 2nd mortgage with limited tax deductibility. You may want to research that if you’re counting on deducting the mortgage interest.[/quote]
This was discussed on a separate thread. As long as it’s a investment home, the interest is always deductible on schedule E.
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