This is a reminder that funds from an equity line or from a “cash out” mortgage are considered to be a borrower’s own “seasoned funds.” Such funds do not have to sit in a bank account to season at all.
Hence, investors, who must use seasoned funds to buy a property,* can access an equity line for 100% of their down payment and closing cost funds. *(Investors are not allowed to use gift funds)
In addition, investors can turn a “gift” into a mortgage (and therefore “seasoned funds”) by signing a note and deed of trust, secured by a property, and recording it. This is a handy and viable maneuver we have used on several occasions to come up with the necessary “seasoned funds.”
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