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taking equity out of purchased home
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   General Questions-> Mortgage Loan FeaturesMessage format
 
mike
Posted 12/25/2005 2:39 PM (#645)
Subject: taking equity out of purchased home
How do I pull equity out of a property shortly (less than 30 days) after the purchase ?
Shane Milne
Posted 12/27/2005 2:27 AM (#648 - in reply to #645)
Subject: RE: taking equity out of purchased home
If the home appraises for more than what you owe on it then by doing a cash-out refinance or obtaining a new 2nd mortgage.What is your situation? Is this your primary residence? Rental property? Good credit & scores?
Guest
Posted 12/29/2005 5:00 PM (#652 - in reply to #645)
Subject: RE: taking equity out of purchased home
you refinance it you genius
Castle Hill Funding
Posted 1/2/2006 8:27 PM (#656 - in reply to #645)
Subject: RE: taking equity out of purchased home
Your question is deceivingly complex, here’s why. Almost all lenders have (2) formulas used to calculate your current appraised value, they are as follows;
1). During the 12 mos. immediately following the original date of purchase your current value is determined by using the lower of the original sales price or the current appraised value...they call this seasoning of value. There are a handful of lenders that use a slightly different formula, the anti formula, if you will, it is stated as follows; .
2). The current appraised value during the 12 mos. immediately following the original date of purchase is determined by using the greater of the original sales price or the current appraised value.

This 2nd definition is the one that you would need if trying to take advantage of a legally stolen (meaning you got a price that was below the current market price when you purchased the subject property) home and you want/need to extract some equity directly following closing. Otherwise, you can get your original down payment back out in some cases by utilizing a 100% (c)LTV HELOC or fixed 2nd but, the value they use will be the original purchase price you paid (definition #2) for the home regardless of what the comps may indicate if within the 1st 12mos.

P.S., Ignore the uninformed guest post who said, "You refinance it genius" as yours was a GOOD QUESTION and the answer clearly not as straight forward as many would think.
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