High-end Residential Cash-out Refinance

Creighton & Associates has received a high-end residential cash-out refinance request.  The loan amount requested is approximately $3.5 million, and will pay off existing liens, debts and back taxes.  The collateral is an owner occupied single family residence with an estimated value of $5 million.

We’ve reviewed the initial package and detail and have had a few discussions with the borrower.  The package has not been forwarded to the fund yet, because we’re missing important information which is necessary for proper review.  The borrower is supposed to provide the missing data this week.

The fund has capability of funding these types of loan requests.  These files aren’t evaluated based on credit scores, assuming there is a logical explanation for past credit issues.  However, one pressing issue will be the appraisal evaluation.  At a quick glance, the appraisal is using comparables from over 50-miles away.  Unless this is truly a unique property, that won’t be acceptable.