"cash Out-refinance" And Tax Liabilites
I purchased an investment property (foreclosure)and am closing on the 15th. of dec. 2006. I am buying the property at a purchase price of $92,000, and will do a cash out- refinance two weeks later. The property should appraise at around $138,000. It needs very little work, painting basically I am doing a 90% LTV refi which would allow me to pull out around $32000. My question is, will I have any tax liability on this money? I don"t plan to put any of it back into the property. I plan to pay off some credit card debt with it.
What company are you using that will let you do a 90% LTV cash out refi?
Sorry, I know nothing about taxes.
Quote:
On 2006-11-26 21:05, joejames wrote:
I purchased an investment property (foreclosure)and am closing on the 15th. of dec. 2006. I am buying the property at a purchase price of $92,000, and will do a cash out- refinance two weeks later. The property should appraise at around $138,000. It needs very little work, painting basically I am doing a 90% LTV refi which would allow me to pull out around $32000. My question is, will I have any tax liability on this money? I don"t plan to put any of it back into the property. I plan to pay off some credit card debt with it.
Refinancing the house is a nontaxable transaction. You will pay taxes on the property when you sell it.
I just got through doing a 90% cash-out refi. My company does an 80% 1st, and a 10% 2nd (fixed). Pulled out $32,500.
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