In today’s real estate market, it is not uncommon for a home to be purchased for cash. Often times if you can purchase a home for cash and close right away, you are able to have a higher likelihood of having your offer accepted or getting a better price for the home.
However, one thing that not all cash buyers are aware of, is the fact that you can refinance a home that was purchased through cash, by using a conventional loan program.
The Fannie Mae “Delayed Financing Program” is a mortgage program that allows a buyer to pay cash for a home, then immediately begin the refinance process to regain access the cash used at closing.
Prior to the Delayed Financing loan, buyers were required to wait six months prior to making a refinance of a straight cash purchase.
However, under the program guidelines, buyers who use documented cash to purchase a home can refinance that cash, via a cash-out refinance almost immediately after closing and do not have to wait the standard six month waiting period to do a cash out refinance.
In order to use the program, buyers must be able to:
- Document a paper trail for the cash used to make original purchase.
- Obtain a new loan which does not exceed property's original purchase price.
- Have a clear property title, which shows that no liens exist on the home.
In addition, buyers are required to prove that the purchase transaction involved no collusion and that there was not a relationship between the buyer and seller.
Finally, the program will normally allow for a new loan up to 70% of the original purchase price and can be used for a primary residence, a vacation home, or an investment property.
As always, it is best to speak with a licensed mortgage lender, such as Strategic Mortgage to fully qualify for a home loan and see what option is best for your specific situation.
For more information on current home loan programs and options for existing and potential home owners, please contact Bill Kamboukos of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com
Equal Housing Lender - Strategic Mortgage AZBK#0909514 - NMLS#158804 –
Vasilios Bill Kamboukos - NMLS#160440
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