The Delayed Purchase Program - Cash Out Refinance
The delayed financing cash out refinance has become quite a popular mortgage over the last year as more and more buyers and investors are paying cash for the homes they wish to acquire. This makes the buying process easy and then the cash is recaptured later so the owner can continue on more liquid again.
It used to be that you would have to wait six months to do this but not anymore.
This loan is great for investors who have the cash to purchase the home and fix it up on their own dime and then cash-out so that they can raise money to go purchase another property.
If you are purchasing a short sale or a foreclosure sometimes the property is too beat up for a bank to lend on it. If anything they will force you to do a 203K rehab loan to ensure they have a good collateral. Nowadays well funded clients are doing an end around this lengthy process by just getting their loan after the property is ready for occupants.
Another great use is for the typical home buyer who is competing in the fast paced market place. A listing agent will always choose a cash buyer over an offer that includes financing so if you find a property that you absolutely must have, why not pay cash for it now if you can and get your loan done later. Doing it this way really improves your bargaining power in our very competitive real estate market.
As part of the delayed financing loan program you will be asked to document the source of funds as to how you bought the house. Hopefully this will be a straight forward process of simply showing the source bank account and an explanation of any large deposits.
This is like any other mortgage in that the process is more involved today compared to 5 years ago but at least you are at your leisure to get your money on your own time frames, not the time frames of a stiff contract or pesky seller.