Can you purchase a home and get some equity out at the same

0.10 Dollars($)

Can you purchase a home and get some equity out at the same closing?...If a person found a home with a lot of equity, can they purchase the home and get some cash out at the same closing?

larry · Joined: 27 Jun 2007 Posts: 3328 473.51 Dollars($)

Hi Guest. Welcome to the forum.

Are you buying the home in cash? If not then how can you have equity on the property when you are buying it? The home equity that you are referring is actually belongs to the original owner.

Best of luck,
Larry

gmakerley · Posted: Wed Aug 13, 2008 8:10 am Post subject:

no, quite simply; you cannot get cash back on a purchase. what you can do is reduce the amount of down payment used, which allows you to keep the excess in your pocket.

Guest 0.10 Dollars($)

Maybe Guest is asking if a home appraises at MORE than the purchase price, then could a person borrow more than the purchase price? (I get asked this quite a lot since there are many foreclosed homes on the market that are selling at less than the perceived appraised value.) The answer is no, the lender will always use the lesser of the purchase price or the appraised value in determining the loan amount. Unless you get a renovation loan...then you can actually borrow more than the purchase price if you use the funds to do improvements to the house and the loan doesnt exceed the after-improved appraised value. The improvements must be done by licensed professionals, though.

Or if you buy a house at a reduced price, wait at least a year (I think that is the time requirement) and if a new appraisal shows the house is worth more than you purchased it for, you then will have that additional equity and could possibly pull some equity out of the house with a refinance or a home equity loan if it appraises high enough.

Just thought I would throw this out there, since that question has come up lately with all the foreclosed properties- and maybe this is what Guest is asking.

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