Consumption and Real Estate
Refinancing to cash out on investment property at 80% appraised value.?
Question : Refinancing to cash out on investment property at 80% appraised value.?
Example: propert is appraised a $ 65k, 80% of that is $ 52k. Amount owed is $ 24k, cash out would be about $ 24 after fees. Would taxes be owed on this amount or only when house is sold for final price?
cash out refinancing
Best answer:
Answer by DebtFreeGuy
It only has to do with the sale price and not the loan amount.
No taxes due on the cash out from the refi.
It is one strategy to obtain tax free $ from investment RE. Your basis does not change however, and the amount of cap gains will still be based on the sales price less the basis.